THE LIBRARY OF THE NEW YORK STATE SCHOOL OF INDUSTRIAL AND LABOR RELATIONS AT CORNELL UNIVERSITY Cornell University Library The original of tiiis book is in the Cornell University Library. There are no known copyright restrictions in the United States on the use of the text. http://www.archive.org/details/cu31924002379893 METHOD OF DIRECTING THE WQRK OF GOVERNMENT EMPLOYEES HEARINGS BEFORE THE COMMITTEE ON LABOR HOUSE OF REPEESENTATIVES SIXTY-FOURTH CONGRESS First Session ON H. R. 8665 A BILL TO REGULATE THE METHOD OF DIRECTING THE WORK OF GOVERNMENT EMPLOYEES MARCH 30, 31, APRIL 1, and 4, 1916 WASHINGTON GOVERNMEN"T PRINTING OEEIOE 1916 METHOD OF DIRECTING THE WORK OF GOVERNMENT EMPLOYEES. Committee on Labor, House of Representatives, WasUngton, D. C, March SO, 1916. The committee met at 10.30 o'clock a. m., Hon. Edward Keating (acting chairman) presiding. Mr. Keating. Gentlemen, the committee will be in order. This meeting was called for the purpose of granting a hearing on H. R. 8665, introduced by Mr. Tavenner. This bill, as you know, has been favorably reported, but the acting clerk of the committee telephoned the members of the committee and arranged for this hearing. STATEMENT OF MR. JAMES A. EMERY, COUNSEL NATIONAL ASSOCIATION OF MANUFACTURERS AND OTHER ORGAN- IZATIONS, WASHINGTON, D. C. Mr. Emery. Mr. Chairman and gentlemen of the committee, with the permission of the committee I should like to incorporate the bill as part of my remarks, in order that you may appreciate the objec- tions addressed to its form. Mr. Keating. There will be no objection to that. [H. R. 8665, Sixty-fourth Congress, first-session.] A BILL To regulate the method of directing the work of Government employees. ' Whereas certain executive departments are installing in their respective establish- ments new systems of shop management, known by the generic term of "scientific management," which have for their purpose the attainment of the maximum efficiency from both plant and workmen; and Whereas a stop watch is used in timing workmen while at work to ascertain the maxi- mum amount of work possible for the most capable man in a given time and making this the "standard time " in which work must be done, and by a system of premiums and bonuses, together with disciplinary measures sufficiently severe to enforce the system, this "standard time" is the speed to which all workmen must eventually attain if they are to retain their employment; and Wliereas experience has shown that the American vorkman by his exceptional celerity performs about twice the work performed by the manual worker of other countries, with the concomitant condition that the ratio of accidents here is from three to four times as high as in other countries; and the tendency of so-called "scientific management" through the above timing and bonus features will be to further aggravate the accident disabilities and mortality aforesaid and reduce the workman to a mere mechanical, instead of a social and moral, relation to his work, and, more- over, are unnecessary to secure adequate efficiency of labor; and Whereas by a stop-watch time study you maye be able to determine the time in which a piece of work can be done, but you do not thereby determine the time in which it ought to be done: Therefore Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That it shall be unlawful for any officer, manager, superintend- ent, foreman, or other person having charge of the work of any employee of the United PROPERTY OF LIBRARY 3 NEW YGBK STATE SCHOOL INDUSTRIAL AND Ikm BELATIDNS 4 METHOD OF DIEBOTING WOEK OS GOVERNMENT EMPLOYEES. States Government to make or cause to be made with a stop watch or other time- measuring device a time study of any job of any such employee between the startmg and completion thereof, or of the movements of any such employee whUe' engaged upon such work. No premiums or bonus or cash reward shall be paid to any em- ployee in addition to his regular wages, except for suggestions resulting in improve- ment or economy in the operation of any Government plant. Sec. 2. That any violations of the provisions of thm act shall be deemed a mis- demeanor and shall be punished by a fine of not more than $500 or by imprisonment of not more than six months, at the discretion of the court. Mr. Emery. I represent, in opposition to the pending measure, the National Association of Manmacturers, composed of some 4,000 members operating manufacturing estabHshments in many of the States in the Union, and a great number of associations who are par- ticularly opposed to this proposal, a list of which will be supplied to the committee. I desire first of all to express on behalf of those whom I repre- sent and myself our appreciation, of the privilege which the com- mittee has given us of appearing in opposition to this measure. As I imderstand it, no hearings have been held upon the pending bill at this session of Congress, but I was informed that Mr. Tavenner, the author of the measure, had made a statement to the committee con- cerning it, but as it was not reported, I am not familiar with the attitude assumed by him in support of the proposal; I shall therefore detain the committee but a very few moments with what I have to say, preferring to ask your attention to the testimony of gentlemen whose experience entitles them to speak with peculiar authority upon the principles of so-called scientific management, which is the subject of attack in the pending measure. The bill that is before you is a highly penal statute, and it under- takes to make criminal and to punish by fine and imprisonment acts which in themselves are certainly of an innocent character, and which either must indicate a malicious intent or must result in an end so injurious to the public welfare that in the judgment of this com- mittee it has been necessary to attach, even in the employment of these methods by oflELeers or employees of the Government, the penalty of fine and imprisonment. What is it that is penalized ? The thing forbidden by this measure is the use by any officer or person having charge of the work of any employee of the Government of the United States of a stop watch or other time-measuring device for the purpose of making a time study of the job of any Government employee between the starting and completion of it, or of the movements of that employee while engaged on such work. The payment of any premium or bonus or cash reward is forbidden under penalty of six months' imprisonment or $500 fine as a maximum, except for suggestions resulting in improve- ment or economy in the operation of the plan. Mr. Denison. Eight there, the bill reported out had a slight amendment. Mr. Emery. I have not seen that, of course. Mr. Denison. There was an amendment inserted there which in .substance reads, "for the purpose of fixing a service standard of the employees." Mr. Emery. You mean that no premium, bonus, or cash reward is to be paid for the purpose of fixing a standard? METHOD OF DIBEGTING WOEK OF QOVEBNMENT EMPLOYEES. 5 Mr. Denison. No stop watch or other device shall be used for the purpose of fbdng a service standard of the employee. That was inserted in the bill as reported out. Mr. Emery. Where would that language go in ? Mr. Denison. After the word "work," change the period to a comma in line 9. I will state further that the bUl was amended in three particulars, as I remember. In the first place, all the whereases were stricken out, and on line 7, on page 2, insert in lieu of the word "service" the word "system." Mr. Emery. Time-measure system ? Mr. Denison. Yes; instead of the word "service," and in line 9, on page 2, the period after the word "work" was stricken out and the comma inserted in lieu thereof, and after the comma the following words: "for the purpose of fixing a standard of service requirements for such employees." In that form the bill was favorably reported. All of the whereases were stricken out. The introduction of the bUl still remains. The recital still remains. I do not know that these amendments change the bill except they define and limit it in a sense, and simply prohibit the use of those stop watches and other timing systems bemg used for the purpose of fixing a standard of service requirement. Mr. Emery. As we view it the changes do not substantially affect the purposes of the measure or its effect upon the application of engineering science to industrial production. The exclusion of the preamble is, of course, merelv the exclusion of what may be con- sidered as argumentative as distinguished from the penal language of the statute itself, so I shall assume, for the purpose of argument, that the preamble supplied at least the chief argument of the author in support of the statutory suggestion comprehending the body of the bill. Mr. Denison. I made a motion to strike those preambles out because I did not think they had any business in the bill. I thought they would be stricken out on the floor of the House anyhow. Mr. Emery. I can of course understand the preainble has no busi- ness in a statute. It merely prefaces the bill just as an argument, so you may at once have a legislative proposal and the argument to support it in one statement. One striking provision of the measure to which the attention of the mind inevitably turns is the exception from the prohibition of the payment of any premium, bonus, or cash reward in favor of any "suggestion resulting in economy or improvement in the operation of any Government plant." By implication the exception leaves it open to the Government, or to the officer representing the Govern- ment, to pay a cash reward or a premium or a bonus for any sug- gestion resulting in improvement or economy of the plant if made hj an employee, while, of course, in the same breath it forbids the doing of certain acts which, in the practice and experience of those charged with the superintendence and direction of the Government plant, have been presumed and, as they believe, demonstrated to contribute to improvements and to economy in the operation of the plant. It seems to us that, assuming the preamble to be an argument on behalf of the measure and to suDstantiaUy state what, in the absence of any other record, I must assume to be the brief of the proponents 6 METHOD OP DIRECTING WOEK OF GOVERNMENT EMPLOYEES. of the bill, that such .assertions are predicated, with the exception of the first paragraph, on gratuitous presumptions that are unproven and unprovalsle. We deny absolutely that scientific management, under- stood as it is and not as it is represented to be, uses a stop watch for the purpose of timing workingmen to ascertain the maximum amount of work possible for the most capable man in a given time, or to make this standard time in which work must be done, or by any system of premiums or bonuses, together with disciplinary measures suffi- ciently severe to enforce such standard time as the speed at which all workmen, or any worknaan, must eventually attain. We deny that "experience shows that the American workman, by his expe- rience, his exceptional celerity, performs twice the work performed by the manual workers of other countries, with the concomitant conditions that the ratio of accidents here is from three to four times as high as in other countries," or that the tendency of so-called scientific management or of time studies or of bonus features tends "to aggravate the accident disability and mortality aforesaid, and reduce the workmen to a mere mechanical, instead of a social and moral, relation to his work," and are unnecessary to secure adequate efficiency of labor. And we deny especially that "by any stop watch or time study you are able to determine the time in which work can be done, and do not thereby determine the time in which it ought to be done." With respect to the number of accidents charged, I respectfully call your attention to the uncontradicted assertions of the Chief of Ordnance having charge of the work of the Government depot, that the percentage of accidents in Government plants among those work- ing under the premium system is less than those engaged in day's wpfk. That statement has been reiterated by Gen. Crozier in his public testimony, and I have never seen any statement of fact to refute it. I furthermore beg to call your attention to the fact that so far as any testimony before your committee is concerned, and so far as any investigation made by this committee or any committee representing it, there has been no condemnation of any system or of any time study or of any premium or bonus method in operation in the only Government plants in which time study and premium payments have been in operation, that at Watertown since 1909. I observed from the testimony of Gen. Crozier that he has fre- quently pointed out that while the very able subcommittee of this body which investigated this matter very thoroughly in 1911 and 1912, when the subject was first brought here to your attention, when making investigation of the Watertown plant, did condemn practices which it believed did not arise out of scientific management, but which were apprehended but not found by the committee to exist, either as a part of the system or as a fact of operation in the Government plant, and which Gen. Crozier has repeatedly stated in his testimony, if they did exist, would have been condemned by the Ordn-ance De- Eartment as quickly as they would be by the committee, as well as y all just and intelligent men. So that it seems to us that the testimony before your committee, so far as we have been able to find it in condemnation of a speculative possibility or of abuses that might creep into a system, are appre- METHOD OP DIREOTING WORK OF GOVEENMENT EMPLOYEES. 7 hensive, but no committee or subcommittee of this body has found as a matter of evidence that they exist. Mr. Denison. It was represented to this committee here when this matter was up that those things did exist. Mr. Emery. You mean to this committee in the hearing on this bill at this time? Mr. Denison. Yes. Mr. Emery. Was there any record kept of that testimony ? Mr. Denison. I do not know anything about that. Mr. Emery. I found no testimony in connection with the matter before the committee. Mr. Nolan. I find plenty of testim'ony to that effect in the hearings held before the Sixty- third Congress. Mr. Denison. It was understood that we should consider that hearing in the Sixty-third Congress as before this committee. Mr. Nolan. The statement was also made here that this was brought to a head in the Watertown Arsenal by a strike, which was investigated by a subcommittee of the Committee on Labor, and that they went back to work at the request of the War Department. Mr. Emery. I assume, Mr. Nolan, that was the investigation of 1911 and 1912? Mr. Nolan. That is the investigation you have referred to. Mr. Emery. Well, Gen. Crozier nas recently stated — this is a very recent statement — in an address delivered before the Philadelphia School of Commerce and Accounts Mr. Nolan. Gen. Crozier also appeared before this committee and his testimony is printed, and at the same time men from the Water- town Arsenal were here and told of the conditions that existed at the Watertown Arsenal. Gen. Crozier also appeared before this com- mittee and admitted, in answer to a question of mine, that he never gave men in the Watertown Arsenal the same consideration in the old day-wage system as he did under this so-called scientific-manage- ment system and gave no reason whatever for the discrimination. They would allow only 10 men out of aU the first-class machinists to enter the first class but would admit 100 per cent of the employees there under the premium-and-bonus system to first class. Mr. Emery. I trust the committee will distinguish between an objection aimed at the philosophy of a system and one aimed at its administration. The argument there seems to be that the system was so good that everybody wanted to share in it, not everybody Mr. Nolan. The question is not that the men are not entitled to enjoy it, or prefer to enjoy it. but Gen. Crozier admitted, in answer to a question of mine, that he did not allow them to go into the first class and gave no reasons whatever for it. It is in the testimony taken before the Sixty-third Congress. Mr. Emery. Of course, what this bill attempts to do is to prevent that time study, so the time study must be assumed to be bad in itself, otherwise it would be remarkable that any committee would make an otherwise innocent act a criminal one. If it was a bad thing in itself in connection with the performance of Government work, then it should be made a criminal act generally. The position of the gentlemen who appear before you to-day is that they are interested in this matter, and their interest is one which at first may appear remote and indirect, yet is very intense and direct. 8 METHOD OF DIRECTING WOBK OF GOVERNMENT EMPLOYEES. not merely as citizens of the United States interested in the economic and efficient operation of Government plants, and particularly at a time like this when preparation for military and naval preparedness is occupying attention and when efficiency in Government establish- ments IS a thing to be especially sought, but these gentlemen represent both in the manufacturing world and in the engineering profession the intensive study of the apphcation of engineering knowledge and skill to the conservation of human energy and the promotion of efficiency in industrial production. To them scientific management is a labor- saving device. It represents, as they believe, the furthest progress that has yet been made by an application of knowledge, skill, pro- fessional study, and experience 'to the doing of something which has certainly been the prime effort of the human race since the beginning; to so develop, so multiply human power through the tools which the human hand and the human mind can devise, use, and direct that there shall be a constantly increasing ratio between a given exercise of human energy and the amount of production resulting therefrom. The great distinction between barbarism and civilization, materially speaEng, is a distinction based on the ever-increasing pro'duction which the machinery of civilization in every form, not merely that of mechanical appliances, supplies. Mr. Nolan. Is not that just exactly where the quarrel comes ? It is not against the introduction of labor-saving machinery or labor- saving devices, but it is applying the stop watch and other time- measuring devices to the human dement involved. Mr. Emert. Very well, I shall not undertake to enter into an argument on that matter with you, Mr. Nolan, because those gen- tlemen who have made those features of efficiency measure a life study wiU testify with much more authority than I. Mr. Nolan. The reason I bring that up at this time is that you were just touching on that point. Mr. Emery. I am laying down an ultimate principle. I could reply to that, of course, by saying that the human factor directs the machinery; the human factor is the directing force in every human operation. You gentlemen think nothing wnatever of the applica- tion of the stop watch in the practice of gunnery, where a gun crew point a gun and hit a target, the two elements of time and accuracy being essential. Naval officers work with watch in hand on the deck of ship to direct that fire, not with any thought of pressing the human act to its top speed, but with the idea of ascertaining by analysis not only the time in which a thing can be done and can be best done, but, by dividing it into its elements and ascertaining how best to do it, to eliminate the waste human motion. Human time is the most valuable thing any of us possess. Mr. Nolan. You wiU agree, of course, that there is no comparison between gun practice and a man working 8, 10, or 12 hours a day 300 days a year or longer ? Mr. Emery. I think the comparison is to the great advantage of the application of any system that conserves human energy in the factory as against the sporadic burst of speed involved in a gun trial. Mr. Nolan. Which is sporadic f Mr. Emery. Yes; of course it depends on circumstances of the battle. Mr. Cooper. May I ask a question here ? METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 9 Mr. Emery. Yes; certainly. Mr. Cooper. This provision which says, "no premiums or bonus or cash reward shall be paid to any employee in addition to his regular wages," would that cover a private establishment that was manufac- turmg supplies for the Government ? Mr. Emery. Not in the form in which it is now drawn, of course. Mr. Cooper. The reason I ask you, there is one firm in the city in which I live, they employ union men there, they work them eight hours a day, and I noticed in the papers some time ago that the Government was talking about having this firm manufacture shrapnel shell casings for them, and that the company that operates this manufacturing industry had offered an inducement to the employees in the shape of bonus to try to turn out more shell casings every day. I was wondering whether this would have any effect on that estab- lishment or not if they were making Government munitions. Mr. Emery. It would have a serious effect on them if they were using such methods in a private establishment and Congress were to condemn them in a public establishment, because I insist, and will cheerfully admit, so far as we are concerned, that if a time study and a premium payment is a bad thing inaJjovernment establishment, it is a bad thing in a private establishment, and if it is a good thing in a private establishment it must be a good thing in a Government establishment. If it is predicated upon an advance of human know- ledge that applies the highest professional skill, experience, and learn- ing to the improvement of efficiency in production it is a good thing. Now if this is a bad thing for Government employees it is a bad thing for private employees, and if these things are condemned by Congress, the public will naturally say, and will properly say, that scientific methods applied to production is a thing that ought to be condemned in private employment because it is condemned in public employment. I do not discuss the legal side of this, because I think there are certain difficulties in applying such a measure as this to private employment. Mr. Cooper. The reason I asked you this question was because this firm, the William Taught Co., engineers and manufacturers at Youngstown, Ohio, a very good firm with their workingmen, in fact they voluntarily give their workmen an 8-hour day and pay them, I think, higher wages, or as high as paid in any part of the country. As I said, I was wondering whether this would work any hardship or not on that establishment there in the city of Youngstown. Mr. Emery. I say it works in an indirect way, as I see it. The terms of this bill apply only to persons having charge of the work of Government employees. Of course, a man is not a Government employee when he is working in a private establishment for a private owner, although he produces for the Government. If this applied to the person directly • Mr. Cooper. That is what I wanted to find out. Mr. Van Dyke. Along your line of argument, how do you explain the situation that exists at the present time where on Govermnent contract work they are supposed to work only 8 hours a day, while usually the shops run 10 hours a day. If it is a good thing for private employees to work 10- hours a day, why not have the 10-hour Gov- ernment service; and if it is a good thing for the Government shops 10 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. to run 8 hours a day why do not the private employees work only 8 hours a day ? Mr. Emery. It does not follow that because the Government is not as economical in the operation of a plant as a private employer that it is a good thing for the private employer to imitate the Gov- ernment. Mr. Van Dyke. Do you contend this is economical for private employers ? Mr. Emery. I contend more than that, if I can ever get to that point. I intended to make a very brief statement and turn you over to witnesses who can speak with so much more authority than I. I do, however, want to point out to this committee one of the principal objections, and many of these I do not care to dwell upon because they will be discussed by men who will speak with greater right and experience than I can. But in its. essence, this is what is so seriously objectionable in this whole proposal. We believe, gentlemen, that you are penalizing efficiency and penalizing it at a time when efficiency is of more worth to the American people and of greater necessity than ever before in their history, both from the standpoint of military and I ndustrial self-defense. We kelieve that this measure by penalizing those things which human knowledge, professional study, and skill has developed and applied with surpassing success to production for the benefit, as we assert, of employer and employee and of the general public, because of the saving which flow from it, is penalizing pro- fessional knowledge and progress. You are making the engineer who applies his talent and skill to the study and application of engineering science to industrial production, a criminal when he exercises it. You are saying to the Government official who undertakes to exercise his skill and knowledge for the benefit of the Government and the people who compose it, and who, as a result of his experience acquired from these studies, applies his knowlegde for the purpose of improving the condition of the Government employees and decreasing the cost of governmental production, a criminal when he ijnproves the public service. You say to the engineering sciences, "If you pursue to the logical end the deductions of your knowledge and apply your experience, you are a criminal." You are penalizing efficiency, you are encour- aging waste, you are supporting the very tendencies that ought to be antagonized and destroyed in American life. If it is true that this system results in injury to the workmen, then this sjrstem ought to be abolished. If it results in benefit to the work- men, it ought to be sustained. But we respectfully submit to this committee that before they penalize innocent acts the value and benefit of which we can demonstrate to any committee by overwhelming tes- timony, not merely from engineers, not merely from employers, but you sh(?Ldd hear the testimony of some of the hundreds of workmen and workwomen who are operating under this system in various parts of the United States and who will give their testimony here under any conditions you may wish to make. Mr. Denison. Right there I want to make a statement that so far as I, myself, am concerned, and I think others take the same view of it, it was on the theory that it was injurious to the individual workman to apply the system and not beneficial. So far as I am con- cerned that was the question involved. MRTHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 11 Mr. Emery. Of course the gentleman can see that obviously no man wants to establish in his plant a system injurious to his workmen. Why, if he were the most degraded brute, he would be destroying himself by his own selfishness. Mr. Denison. Excuse me for interrupting you again, but it was not contended that any one would purposely injure an individual, but the contention was made to me, or in my presence, that in the appli- cation of this system they took the highest standard as a standard, the highest results as a standard, and that in the ultimate applica- tion of the system the tendency was to destroy the vitality of the workman. Mr. Emery. I say that is utterly denied. Mr. Denison. That was the theory presented to me; that was the theory on which I favor the bill. Now, if I can be convinced other- wise Mr. Emery. I know the popular misapprehension of scientific management. I think it has been misunderstood by people sincerely deluded, and perhaps by others desirous of misrepresenting it, because this system does increase human production. It does increase human capacity to produce and to produce with the least exercise of effort, and if it does that there are those who will oppose it, because there has been an age-long fight against every tool and every machine and every tendency that has undertaken to mechanically increase pro- duction. Saipuel Arkwight hid his loom. The very father of textile progress was followed by mobs because it was feared by the suspicious workingmen of his day that it meant depriving the hand loomer of work for all future time. You can read to-day the resolu- tions of the men engaged in carrying passenger traffic, on the Hudson Kiver, who expressed themselves as opposed to the steamboat which Fulton invented. You can read to-day in McMaster's History of the United States, the opposition expressed to the first steam railroads by the stage driver, and u we are to oppose the advance of human science and human knowledge and the application of human experience because it tends to increase production on the mistaken theory that there is only a given amount of work to be divided among mankind, and not that the man carries in his own person the sole fund out of which he is to pay his way in life, there can be no progress materially, for without a continually increasing efficiency, not only on the part of labor but especially on the part of the directing forces of capital, progress ceases. Mr. Denison. Right there is the very meat to the whole proposi- tion. They did not appear here in opposition to this on the ground that it increases production, but it was thought, or so represented at least, that any system, although it does increase production, if it does so at the expense of the hum^n machine it is not a good thing althou^ it does increase production. What do you think of that ? Mr. Emery. I accept it absolutely. If this were a method the effect of which was to increase production at the expense of the human being who participated in it, it is a bad system. Mr. Denison. That was the question in my mind that was in- volved in this whole controversy. Mr. Emery. On the contrary, we intend to show you gentlemen that the purpose and effect of this system, as it is in actual operation in himdreds of private plants in this country, is to save human 12 METHOD or DIEEOTXNG WORK OF GOVERNMENT EMPLOYEES, energy, to show every man how to do his work in the best way, by submitting his operation to the study of experienced and skilled en- gineers. For there is a distinction" between the men who do the work and the men who plan the work; that it is the application of what may be called engineering science to industrial production ; and it provides that when an operation is begim it has been predeter- mined in every step what shall be done, and the relationship between the material, the human element, and the mechanical has been extab- lished all the way through. We do not forget, we will readily admit, that Uke every human science and every human application of knowledge or skill or power it is capable of abuse. There is not anything good that is not capable of abuse. Government itself is capable of abuse, and the history of mankind has shown its constant abuse more than any other great power, yet we can not do without government. Knowledge has been abused, yet the world can not hve without knowledge. Skill has been abused, yet the world can not exist without skiU. If it be said on the other hand that this result or that result is undoubtedly increasing the skill of unskilled men, so that unskilled men can do the work that skilled men did before, that is an advance in himian knowledge and human science. If we could discover any way to eliminate disease from the world, would we argue that disease ought not to be eliminated because doctors would be deprived of their livlihood? If we could get along without lawyprs, could my profession make an argument against the improvement which did it ? Anything human knowledge can lend to the human race to properly increase its efficiency or its productive capacity, has improved and benefited aU of the human race, because I believe you can not define prosperity in any other way than by describing it as an abundance of commodities fairly distributed among those who produce them, and there can not be any abundance unless there is increased production. Mr. Keating. Can you state whether or not scientific shop man- agement takes into consideration how long a man can live speeding up to his highest capacity? Mr. Emery. There is an implication, of course, in your inquiry, Mr. Chairman, that indicates that you believe that scientific shop management undertakes to speed a man up to his highest capacity. Mr. Keating. I believe it does. Mr. Emery. We are trying to offer you evidence to the contrary. Mr. Keating. My experience with it leads me to believe that. When you put a stop watch on a man, you Mr. Emery (interposing). You are considering the stop watch to be used solely to determine how fast they can go. Mr. Keating. Then set the pace" for the others. Mr. Emery. That is precisely ijrhat the system does not do. We utterly deny it. That is a matter we desire to give you testimony upon. Mr. Keating. Of course, you speak theory and book knowledge. You have no practical knowledge as to what your condition would be after working a month at highest speed ? Mr. Emery. I am offering the testimony of the gentlemen who not only direct time studies but who have worked under them, and we are ready to offer you the testimony of many people who do work under them. I tell you again, Mr. Chairman, we do not deny that METHOD OF DIREOTING WORK OF GOVERNMENT EMPLOYEES. 13 any system is capable of abuse, but because a man can say here and there abuses exist, that may be evidence for its reform, but not for its abolition. Under any system of daily pay, under any system of piece work, under any 6, 8, or 10 hour day, there is the same possi- bility. That is not elimuiated by eliminating time studies, because I thmk we shall be able to demonstrate to you that the purpose of time study is not to ascertain how fast a man can work, what his maximum speed is. and then keep him at it until exhausted and worked out. If that is what it means, it ought to be damned, and every witness here will agree to that. Mr. Keating. I do not know that they mean it, but I am con- vinced that is the ultimate result. Mr. Emert. Then you apprehend a fear of it in the end ? Mr. Keating. From my own experience. Mr. Emery. It was feared that when we got the mechanical loom, that we were going to do away with the men who worked with the hand looms. Mr. Keating. That argument does not apply. Mr. Emery. It was feared that when we got a machine for making shoes that the shoemakers were going to lose their living. If we are going to that argument, we must give up the thrashing machine and go back to the flail; we must give up the sewing machine and go back to the needle and thread. Mr. Denison. That involves a displacement of human labor; a spreading out of human labor. I think there is a distinction there. I do not think any of us would or could argue against scientific dis- placement of human labor if it could increase efficiency and time production. But the question this bill involves is the speeding up and the increasing of the amount of work an individual can do, rather than- the displacement of human labor. Your illustrations have to do rather with the displacement of human labor. Mr. Emery. Those particular illustrations, of course, were directed to another matter. I do not want to take the time of this committee further. I have trespassed far more than I desired, because much more important witnesses than myself will be presented to you. But I wanted to outline this position and make it plain, and I trust you gentlemen recognize, and I am sure you do, that if this is a bad thing in Government management, it would be a bad thing in pri- vate management, and if it is a good thing in private shops it must be a good thing in Government shops. * And it certainly is the duty of the Government not to discourage and not to penahze, but to encourage, approve, and promote efficiency rightly understood, and any attack upon a thing which in itself promotes that efficiency, not at the expense but at the conservation of energy, is a thing which this committee ought not to condemn, but a thing it ought to encourage and approve. Mr. Cooper. May I ask you one question ? Mr. Emery. Yes, sir. Mi. Cooper. We have a firm in the city in which I live which pays a bonus every year. I think this year they paid about half a million dollars bonus to their employees. Do you think a bill of this kind would have a tendency to do away with that bonus in private estab- lishments ? 14 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. Emery. It does away with it in public establishments; there is no question about that. Mr. Cooper. Do you think ultimately it would reach into private plants? Mr. Emery. The terms of the bill do not reach private plants, but by its example it does. Mr. Nolan. You know there is not such a parallel case, where the Government itself pays a bonus at the end of the year, as stated by Mr. Cooper. Mr. Emery. There is not now, but there is nothing in the future to prevent it, providing this committee does not prohibit it, and put the man in jail who suggests it or does it. Mr. Nolan. The only thing which will prohibit it is that the Ap- propriations Committees of Congress do not look with much favor on those payments. , . Mr. Cooper. Here is what I had in view. If it be a violation of the law for the Government to do that, it would not look very well for a private establishment to do it, woiild it ? Mr. Emery. If the Government says it is a thing to be condemned; if the Government says a man ought to be put in jail, being an officer of the Government if he, as your former bill says, recommends the payment, or as this bill says, pays or promises a bonus other than wages, then certainly it is a bad thing in a private establish- ment, but, of Qourse, it goes on in private establishments, and this would tend to discourage it. If the committee believes that the man who pays a cash bonus to an employee at the end of the year is a man who ought to be made a criminal, that ought to remain there. Mr. Keating. Is that statement quite fair? Congress, we pre- sume, wants to enforce the provisions of this law. Mr. Emery. Yes, sir. Mr. Keating. It does not want any public official to evade the provisions of this law. A public official who seeks to evade the will of Congress is to be punished for evading his instructions from his superior officers. That has nothing to do with what may be done in private establishments. It is simply a method by which Congrras undertakes to enforce its instructions to .the employees of thee Government. Mr. Emery. Why does Congress undertake to do it, Mr. Keating ? Mr. Keating. Because Congress undertakes to eliminate this par- ticular thing, this practice, in Government plants. Mr. Emery. If it is a bad thing for an officer of the Government to pay a cash bonus at the end of the year to stimulate a man to per- form his work, why is it not bad a thing for a man in a private plant ? Mr. Keating. If you do it under conditions which affect the body of the employee, his physical weU-being, his mental well-being, then it is a bad thing. Mr. Emery. Whatever your reason for doing it, if it is a bad thing for a man to do it in a public establishment, why is it not equally a bad thing in a private establishment ? Mr. Keating. That is true. Mr. Emery. Of course, that is apart from the time study. This is a separate proposition. Mr. Keating. But this has to do with Government work. METHOD OF DIEECTING WOKK OP GOVERNMENT EMPLOYEES. 15 Mr. Emery. Surely. Mr. Keating. And at times it has been suggested that Government officials seek to evade the regulations laid down by Congress. Mr. Emery. Of course, it throws us back always on the original proposition, that the thing itself either is a good thing or a bad thing. It either ought to be encouraged or discouraged. It either ought to be penalized or approved. If the payment of any kind of bonus or premium is a thing that ought to be penalized in a public establish- ment, then the payment of a bonus or premium ought to be discour- aged in a private establishment. Mr. Denison. I think that situation Mr. Emery (interposing). Here is a perfect parity between the conditions of production. Mr. Van Dyke. The people whom you represent, do they take the same stand for the same reasons in opposmg this bill as they did when they opposed the right of Government employees to appeal to Cpngress and to organize ? ifi. Emery. The association that I represent never opposed the right of Government employees to appeal to Congress. Mr. Van Dyke. We had a little hearing about five years ago before the Civil Service Reform in the Committee on that very subject, the right of Government employees to organize, and under section 6 of the appropriation bill of 1912, known at the time as the Lloyd bill, and was afterwards incorporated in that appropriation bill. Probably my memory needs jogging, but if I remember rightly, you appeared before that committee opposing the Uoyd bill ? Mr. Emery. I did, Mr. Van Dyke. Mr. Van Dyke. As representing Mr. Emery. I appeared and opposed it on the ground that we ought not to permit organized unions for the purpose of coercing the Gov- ernment by threat of strike. I take that position to-day asl did then. Mr. Van Dyke. That did not imply forcing the Government by strike. Mr. Emery. As the bill was then drawn it impUed it; but to my recollection it was clearly shown that not only had there been strikes, but, as Mr. Morrison put it at that time, there was no reason why, if one man desires to "resign" and exercises that right, that many men could not exercise the same privilege and effect a wholesale resigna- tion of Government employees for the purpose of securing from the Government concessions by what was nothing else than a strike. Mr. Van Dyke. The Government employees made the statement at that time that they did not believe in a stfike, and they have never struck since the time they were organized. Mr. Emery. This biU is predicated, as the gentlemen say, on an apprehension, and my argument is predicated on the very serious apprehension that the testimony supported that belief, but at this point, with your permission, I should like to present these other gentlemen. Mr. Nolan. Your organization is composed of 4,000 members ? Mr. Emery. Four thousand members, manufacturers. Mr. Nolan. Largely running manufacturing establishments ? Mr. Emery. Substantially all. 16 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEr,?;. Mr. Nolan. Do you know what percentage (I presume it is a question pretty hard for you to answer), but do you know what per- centage of the members of your association has adopted the pohcy oi scientific management ? Mr. Emery. That would be a very diffictilt question to answer. I should say, generally speaking, from my experience with the membership, that there is hardly a plant in which the prmciple behind scientific management is not more or less in operation, and I would say that it was successful and that its ernployees' relation with the management were good almost in proportion to the adoption m whole or in part of the principle. Mr; Nolan. That is it, in whole or in part. Do you know how many of the estabhshments have apphed the stop-watch and time- measuring element of the so-called scientific management system ? Mr. Emery. I could not say that, Mr. Nolan, but the practice is general, and let me say there I do not want to repeat again the very remark I have made about the misrepresentation of the use of that, because quite apart from the fact of dealing with the human element in the production you must remember that the employer is imder- taking aU the time to ascertain cost. He wants to know all the time what it costs to produce his commodities, and the element of time in the labor operation as an element of cost is of a very important character. Mr. Hurley, of the Federal Trade Commission, is at the present time engaged in an endeavor, on behalf of the Trade Com- mission, to convmce the business men of the United States that they need a far more efficient system of cost accounting and that they must know what every item of production costs, and that until they do that they are not m a position to do intelligent business. So he says he wants efficient cost accounting with the time element con- sidered, while at this end of it you are forbidding the thing he says we must have. Mr. Nolan. You could not give us any idea, though, in applying the principle of scientific management to the estabushments, now many of them have applied the stop watch ? Mr. Emery. Other gentlemen who come after me can speak on that. Mr.. Nolan. Do you know anything about a movement which has been started in opposition to this bill; a general movement, sending out circulars and form letters opposing this measure and asking people to forward their protests to Congress ? Mr. Emery. I do not know of any particular movement. I know of a number of organizations and I know of a number of individuals who feel an intense interest in it. Mr. Nolan. Do you know anything about a boom that has been started for that purpose ? Mr. Emery. I do not know what you may have in mind. Mi'. Nolan. I know there are a number of movements. I mean by that various associations that are interested in this matter, associations of manufacturers, are doubtless calling it to the attention of their members. Mr. Nolan. I mean to the pubhc generally, indiscriminately, whether manufacturers or business men, asking them to protest? Mr. Emery. There has been so much talk about it, and some of these gentlemen here can probably tell you about some aspects of that. If you can specify in any way as to any one particular circular I will tell you at once whether I know of it or not. I am not under- METHOD OF DIKECTING WOBK OP GOVERNMENT EMPLOYEES. 17 taking to avoid an answer to your question, but I simply do not know the particular movement you refer to. Mr. Nolan. There are two gentlemen that have sent out letters asking contributions to the expenses of a committee of 10 to oppose lemslation antagonistic to Mr. Emery. Who are theysigned by? Mr. Nolan. One by Mr. W. B. Richardson, 42 Wall Street, the other by Mr. Henry R. Towne, 49 Wall Street. Mr. Emeey. Mr. Henry Towne'is on my right, and Mr. Richardson is also present in the room. Mr. Nolan. We shall be glad to get that information from them. One further question, Mr. Emery: Have 'you read about all of the reports of fnvestigations conducted into scientific management?' Mr. Emery. I have been generally familiar with them ever since they began. Mr. Nolan. Have you read the report of Prof. Hoxie ? Mr. Emery. His last report? Mr. Nolan. Representing the Federal Commission on Industrial -Relations, the final report ? Mr. Emery. Yes; I have read his book. Mr. Nolan. I mean the report made to the Commission on Indus- trial Relations by Prof. Hoxie, Mr. Frye, representing organized labor, and Mr. Valentine, representing the scientific management experts. Mr. Emery. Mr. Hoxie's report had not been made to the Federal commission at the time. He filed a complete report since then and it has been published in the form of a book. Mr. Nolan. The official report is contained in the final report of the Commission on Industrial Relations, pages 209 to 237. Mr. Emery. That is not the complete report, Mr. Nolan. Mr. Nolan. It is their complete report to the Commission on In- dustrial Relations. Whatever is written outside of that was because they were confined to 24 pages. Mr. Emery. They published a very elaborate and interesting book, from Appleton & Co., within seven months. Mr. Nolan. This is the official report to the Federal commission. Ml'. Emery. It was obviously the minority of the committee. Mr. Nolan. It was approved by the whole committee and so stated. I mean by the committee appointed to deal with this ques- tion. Mr. Emery. I mean by the committee on industrial relations, it was approved by a minority of that committee. Mr. JSiOLAN. Mr. Valentine was picked from among those recom- mended by the scientific-management experts. Mr. Emery. Picked by whom? Mr. Nolan. Selected by Prof. Hoxie. Mr. Emery. I know he represented the employers generally; he was so-called, but I do not know. what his quahfications are as an expert. 1 want to present Mr. Henry R. Towne. He is an experienced manufacturer, an engineer widely known throughout the United States and one who has given a very great deal of time to the study of scientific management. :«ii(i2— 16 2 18 METHOD OF DIKECTING WOBK OF GOVERNMENT EMPLOYEES. STATEMENT OF HENRY E. TOWNE, OF THE YALE & TOWNE MANUFACTURING CO, Mr. TowNE. Mr. Chairman and gentlemen of the committee, I may say at the beginning that I am interested in this subject as a manu- facturer, a manufacturer of over 45 years' experience, during the greater part of which time I had been a student of the subject of efficiency and production, long before the present term of scientific management or efficiency engineering had been adopted, but with clear recognition of aU that those terms involved and unpUed. I may mention also that I am authorized to appear here as the representative of the National Association of Manufacturers, of which Mr. Emery is the counsel, and of the Merchants Association of New York, of which I had the honor of being president for some six years. These bodies have all studied this subject at one time or another, aa have many other of our organizations, both industrial and civic, because of the intimate relation between human efiiciency and the results of that efficiency as measured in business of every kind. It is a matter which touches our national interests in every direction and in eveiy sense, not merely in industry and in commerce, but in economics, broadly and nationally, in the sense that we are to meet in competition increasingly in the future the other industrial nations of the world. This bUl prohibits specifically two acts, the time studies and the payment of a premium or bonus. Now, what is a time study ? Have you had occasion to think of it ? As Mr. Emery has pointed out, labor is one of the component parts of cost, and knowledge of cost is essentially the good conduct of busi- ness of every kind, whether mercantile or manufacturing. The mer- chant knows his cost easier because he pays so much for his goods, adds the overhead expense of his business and figures his sales. With manufacturers, on the contrary, the problem is vastly more diffi- cult and intricate. The three great components of cost are labor, material, and over- head or expense account. The ratio of those three varies in different lines of industry. On the average, I think they are pretty nearly ec[ual, but in some that I know of, the labor is much larger than either of the other two. It is rarely less than the third. Therefore, it .is proportionately important tor the manufacturer and for the com- modity of which he constitutes a part, that he shall have knowledge of the cost of his product. Mr. Denison. Right there, will you pardon an interruption « The bill was amended, as I understand it, so as not to exclude the right to use time-saving or time-measurinn; devices to ascertain the cost of production. The bill is not aimed to prevent that, but to prevent the use of time devices for speeding up and fixing standards of service of the employees. Mr. TowNE. I am coming to that. Mr. Denison. That is the reason the amendment was inserted in the bin. Mr. TowNB. If the purpose and result of this system were to do what your question imphes, speed up the employee to his physical and mental detriment, i would be an earnest opponent of it. 1 know not from reading the hearings or investigation, but from personal METHOD OF DIRECTING WOBK OF GOVERNMENT EMPLOYEES. 19 experience for a number of years in the plant of my company at Stamford, yhere we employ some 5,000 people, I know that the con- trary is the fact, that there is no such result. In the ascertainment of cost, and incidental to that in the fixing of compensation for labor, time is the fundamental or vital factor. We recognize that in the old system of compensation, where men were paid by the day or week or hour, time was inevitably the factor there; you had to keep an account of their time. But in modern industry, m aU of the industrial countries, and increasingly, the tendency is to get away from payment by time just as far and as fast as we can, to payment by the piece, or its equivalent, whereby the relative efE- ciency of the different workers is recognized and properly coiiipen- satod. Now, to do that, the element of time at once becomes the fundamental factor, and you have got to observe it. The stop watch is only one of the many time instruments. The in-and-out clock is a thing which is used, has been used for 100 years, probably — certainly within my lifetime of 50 business years, everywhere, yet that is a time-measuring device just as much as the stop watch is. Mr. Nolan. You do not believe this bill would prohibit the time clock, do you ? Mr. TowNE. Not at all; it would not, but logically it should. It either should prohibit both or accept both. But the time measure is only one of the elements in this; to ascer- tain the efficiency of labor and the cost of labor other devices are used. For example, the counter or the scales for weighing. Many machines are operated with an automatic counter attached to them which keeps the record, because the operation is so rapid they could not ba reported otherwise, which shows the output per day or per hour, and that is a time study just as much as the use of a watch. Now, all of these are factors for enabling the adjustment of com- pensation to be made scientifically, more accurately, and more justly thin it can be by any process of guesswork or rule of thumb. Under the old system of piecework, as it began to supersede the simple daywork, the adjustment of piece rates was a constant source of friction and of irritation and of injustice either on one side or the other, because the rates had to be based originaQy on guesswork, in the absence of recorded data, and afterwfjds upon the experience acquired under the rates first adopted. Under that system the inevi- table tendency of the workman, if he found the.t his piece rate was an easy one at which, if he let himself go to his full limit, he could largely increase his earnings, he had before him the apprehension that there- upon the employer would cut his piece rats, as was done repeatedly, and in many cases justly. So that there was a clash or confhct of interests between the two parties to the transaction. The new system., which is one of the elem.ents of so-called scientific management, on the contrary im.plies this: That the employer and the employee together, not always, but sometim.es the em.ployer alone, for reasons I wiU explain later, m-ake a scientific investigation of the thing to be done, of the existing m.ethods of doing it, of the elim.ination of loss and waste ro.otion in those m.ethods, of the modi- fication of those methods, if they involve unnecessary and extreme hum.an effort, in order thereby to determ.ine ultim.ately what is the best and easiest way of accomplishing that particular operation and the time in which it can be comfortably done, and thereby fixing the 20 METHaC OF DIKEGTIJirGWOEK OP GOVEKXMENX ^MPLOYfeES. piece work on a basis, time one factor, and the other factor rate of wages per hour, which that class of operatives are fairly entitled to at the current rates. That does not touch the bonus question, which I wiU come to afterwards. But I do want to empba^size, Mr. Chairman and gentl6^ men, the fact that now for the first time in this adjustnient betweeA the employer and the employee have we got a basis that is not J^erely scientific and accurate, but which is just; a rate which is just to both parties, which gives the workman the mtended and agreed-upon compensation of what he can do in a fair day s work, and which assures him that the rate, having once been fairly adjusted, will be maintained indefinitely. In most of the shops where scientific management is in use, the Eiece rates, as you will learn from other gentlemen who will testify efore you, the piece rates once ascertained in this accurate way, are announced to be permanent to the operatives, and they are encouraged and go ahead and make what wages they can or what wages they please at these rates with the certainty that they are not going to be penahzed if they succeed in making large wages. Another factor as to the stop watch. It has been implied here that it consists, necessarily and always, in the manufacturer standing with his watch in hand alongside the operator and timing him as to this or that operation. That is true in some cases; necessarily true where the operation, for example, is the operation of a paper machine, a machine costing $60,000 to $80,000 and occupying a space twice as long as this room, and where, obviously, work of experiment and in- vestigation must be made on the macnine. But wnen you come to the little operations and the little industries in little metal work, ill shoemaking, or the use of the sewing machine, a great deal of this ex- perimenting is not done in the presence of the operator at aU, because he is not needed, it is not desirable to interrupt or interfere with hjp. It is done in an experimental room with those familiar with the art and industry, and with sufficient experience and skill in it to make these tests and experiments correctly and intelligently. Mr. Van Dtke. Do they not take an operator into that experi- mental room ? Mr. TowNE. Not necessarily. Mr. Van Dyke. Who performs the labor? Mr. TowNE. The experts who are employed for that purpose, Who get a greater understanding and skUl as to how these things should be investigated than any casual operatof could. Mr. Van Dyke. Is it not a fact they do employ, if in a shoe- making establishment, that they do employ a shoemaker? Mr. TowNE. Not necessarily. Mr. Van Dyke. To get results — they do not employ a shoemaker? Mr. ToWNE. Oh, they employ shoemakers, if you call them such. They are operatives on machines. Not one of them could make a shoe if he tried to. Mr. Van Dyke. I am talking about operatives generally, eifi- ployees of that establishment. Mr. TowNE. Yes; but not necessarily employed in this experi- mental room, I am not in the shoe industry, and I only speak ftom general knowledge or hearsay; but in my own industry oUr chief products are locka and hardware, and yet some of the men METHOD OF DIEECTING WOBK OF GOVEBNMENT EMPLOYEES. 21 vfjio conduct this experimented work are not what we would call l6ck makers. Mr. Keating. They are, I understand, experts ? Mr. TowNE. Skilled mechanics. Mr. Keating. And employed for that particular kind of work ? Mr. TowNE. And usually men of higher mentality, if you please, and have had better early opportunities in life and have a clear understanding, therefore, how work of this kind should be done scientifically and studied to attain the best methods of doing that wprk and the time in which it should be accomplished. Mr. Van Dyke. They are picked men? Mr. TowNE. For that purpose. They could not -go out in the ihop and do as much work at the machines as many of the operators. Mr. Van Dyke. Do you say it is only in these two instances that the stop watch is used in timing the individual work of the men ? Mr. Towne. In what instances ? Mr. Van Dyke. You spoke of paper making. Mr. Towne. I spoke of that as an illustration. The same thing would be true of a very large lathe, where it would be impossible to have that in the laboratory for experimental purposes and where you could not move the material; but when you speak of a machine, some not weighing more than that book, a small, inexpensive labo- ratory may be fitted up and used for that purpose. Mr. Van Dyke. Do they use a stop watch on mechanics who do not work by a machine ? Mr. Towne. In the laboratory? Mr. Van Dyke. No; I mean in the shop; in foundries, lor instance ? Mr. Towne. Yes; they would in a foundry, because there you can not transplant the equipment into the laboratory. Mr. Van Dyke. Then they do time the movement of individuals ? Mr. Towne. The stop watch is used constantly and largely on men actually at their work. Mr. Van Dyke. In the fotmdry the principle is absolutely so; is that not a fact ? Mr. Towne. I should say yes^ in most of the foundry operations. And operatives in many of the plants where scientific management is in practice are constantly beseeching the management to put the stop watch on their work in order to bring it under the new system and give them the benefits of it. Mr. Van Dyke. Let me ask you right there, Mr. Towne, who is delegated to use the stop watch, the efficiency engineer or some ordi- nary man, who probably has no knowledge of the trade at all ? Mr. Towns. In some cases it is by what you speak of as the effi- ciency engineer, brought in from the outside, because the owners of a plant have had no previous experience in it. In a plant where the system has been in use for many years, as in nay own, where it has been in use now nearly 10 years^ we have men who have become experts in the work and who make these observations for us, are em- ployed for that purpose. ^Mr.VAN Dyke. What I want to get at is this: The efficiency engineeris a very highly paid inan. That is, the salary he receives is 'considerably greater than the? ordinary working man receives? iir. Towne. Yeis, sir. 22 METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES. Mr. Van Dyke. When they put a number of thosemen in do they put a number of efficiency engineers, or put what they call tune- study or stop-watch men, who are not efficiency engineers but only are supposed to time the movements of the individuals ? Mr. TowNE. They do either or both. Mr. Van Dyke. Which is the most prevalent ? Mr. Towne. In a small establishment and where the range of work covered is small, one man may do everything. In a large estabhshment, as for example, in ours, when Mr. Taylor first came t(J us to start this work he had one high-priced assistant, Mr. Barth, and under him three or four, and, ultimately about ten assistants, clerks, and operators and others, and the work was distributed. Mr. Van Dyke. Not necessarily mechanics or men that under- stood that particular Hne of business ? Mr. Towne. The clerks did not because they had oiily clericfl,l work to do. The men who made studies of productive work were all of them trained as engineers or mechanics. Mr. Van Dyke. The stop-watch men ? Mr. Towne. Those who used the stop watch, yes. Just in passing I should like to point out this fact, that without this system when a new job is taken in, and in most lines of business, and especially in the metal trades, new products are constantly being added ornew work being done for the customers, and under the old method there was no plan, except pure guesswork, for estabUshing the rate to be paid for the labor mvolved, whereas to-day, by reason of these trained experts I have just referred to in answermg the last question, it has been found periectly feasible and is constantly being done to take that new product and analyze it and determine from experience and methods the time required for the operations in making it, thereby establish the correct price to be paid in making it from the start. Mr. Keating. You say these rates are invariably correct from the start. On what basis do you determine those rates? Suppose a new job comes in to be dealt with by a molder, we will say. Mr. Towne. Yes. Mr. Keating. Now, on what basis wiU you determine the piece rate you will pay that molder? Mr. Towne. May I use another subject for illustration, a little simpler than a molder? Mr. Keating. Certainly. Mr. Towne. Well, suppose it is a piece of smaU metal work and which involves turning a bar of steel or brass and sizing it, and finally grinding it to an accurate size. The drawing tells you the length and did,meter of that bar and thereby, you get its superficial area. The records in any establishment where this process has been long in use tell us accurately the cost per square inch of surface for doing each of these different lands of work, for roughing out a bar for the finishing cut, for the grindmg, if it is requu-ed, likewise cutting screw threads different diameters and different lengths. Now, having that fund of information based upon experience, the men take this drawing and analyze it into these component operations, and for each of those operations they use these rules derived from experience, and adding that up they get their cost for this particular piece of work* and we find by experience that labor costs determined m this way are BO accurate that with few exceptions they do not have to be changed. METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. 23 I speak here from very unusual experience, that such errors devel- oped, or are found, are almost without exception errors in favor of the operatives, and, if so, they are let alone. The operatives get the benefit of them. Mr. Keating. You say that they are fair and just to the operatives. What do you mean by fair and just to the operatives? Mr. TowNE. First, that at that piece rate the average operator, in my experience, I can say practically all operators, except some that are thrown out very quickly (of course, you find misfits who ought not to undertake work of that kind, and are not qualified physically or mentally), make better than the wages they would earn if paid by the day for the class of work on which they are employed. That is one answer. Mr. Keating. And it is necessary for the employer to determine how much a man should earn in a day, what would be considered a fair day's work ? Mr. TowNE. No, sir; some men are worth $8, some $5, some $3, and some only $2. That is fixed by the market. Mr. Keating. Considering this particular unit you described a moment ago: If in the judgment of the employer the employee should earn $2.50 a day, and if as aresult of your study you determine more or less arbitrarily that a man should produce 100 of those units in a day Mr. TowNE. Yes; that would be at the 2^-cent rate. Mr. Keating. The employer then would say he would pay 2^ cents for each unit, and if the worlvman worked as efficiently, as skillfully, and as rapidly as the employer thought he should, or the efficiency engineer, as the case may be, and he produced 100 units, he would earn $2.50 for a day's work. Mr. TowNE. That statement needs a little qualification. That rate is fixed on the basis of a day's output which is easily feasible to any man or woman, as the case may be, at all qualified for the work of that particular kind, with the knowledge and expectation that those who have special aptitude for that kind of work are going to exceed the number of pieces a day and will get an extra compensation. Mr. Keating. If the employer is considerate of the employee, of his physical and financial welfare, then he would fix a reasonable task. He would, for instance, say we should produce 100 of these units? Mr. TowNE. Yes, sir. Mr. Keating. But suppose the employer is not considerate, sup- pose he says, "You shall produce 150 of these units in eight hours," and $2.50 would be reasonable compensation for an eight-hour working-day, then, of course, he would (iivide 250 cents by 150 and reduce the cost per unit? Mr. TowNE. He would make a 2-cent rate, we will say. Mr. Keating. Yes; and is there not a very reasonable danger that you simply speed up your employee Mr. TowNE (interposing) . There was just the same danger as this, that if in a given locality, we will say, the rates per hour for a certain grade of machinist were 30 cents and here is an ignorant or an ava- ricious employer, if you please, who thinks he can make money out of his competitors by beating that rate doWn to 25 cents or 28 cents an hour, and he tries to do it, and here and there he will get some 24 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. workman who is out of a job or in need who will accept it, or perhaps a man who is not reaUy cognizant what the rates are, but you know as well as I do that man does not hold his help very long and in the long run he does not prosper. He gets the dregs of the trade instead of the better class of mechanics, and in the long run he can not beat them. Mr. Keating. You do not believe then that low wages, in the long run, are really cheap wages ? Mr. TowNE. I. know to the contrary, absolutely, that high wages mean low cost as a rule. Mr. Keating. Will you give me a little information on another point? Suppose we take this example of 100 units, and the em- ployer feels that the $2.50 would be a fair day's pay. That repre- sents 2i cents per unit. Suppose that an efficient workman pro- duces 200 units, does he get $5 ? Mr. Towne. Absolutely; and in my own plant to-day, Mr. Keat- ing, there are people working at piece rates which were necessarily fixed by this system I have described, because it is new product they were working on — only taken on lately — men. and women both, men whose normal rate of wages, what we expect they would earn, would be about $2.25 to $2.50 a day, and some of them are earning $4 and some $5, and I heard the other day of one making $8 a day. The rate standard is set. Mr. Keating. The rate per unit stands ? Air. Towne. They stand with one exception. If the rates are com- plained about and the workers say, "this rate is too low, we can not make a day's pay of it, " then we investigate the thing most carefully; we see what other workers on the same jobs have to say about it; we review our experiments and tests and figures, and if there is any error it is corrected. Excepting that, the rates stand permanently, definitely, until some change in the job. If we introd\ice new ma- chines or method or change the article or product, then of course the rates have to be reviewed. Mr. Keating. Then in your judgment it would be imjust to the employee to reduce his pay per unit a& his efficiency increased ? To make myself clear Mr. Towne. You make yourself quite clear. Mr. Keating. Do I ? Mr. Towne. I wLU not say whether I think it would be unjust or not, but I say it would be very bad business on the part of the employer, so bad that we do not do it. The very essence of this is that the rates having been adjusted in this careful, accurate, and scientific manner, are intended to be permanent, and will be main- tained permanently until there is some change in the situation, in the condition, some change in the product or the process. Mr. Keating. I want to call your attention to this testimony, which was submitted at the hearings before this committee in the Sixty-third Congress by Gen. Crozier, the Chief of Ordnance, in which he told of the oj)eration of this system in Government factories, and in which he testified that in order for an employee to get a 33 J per cent increase in his salary, his output would be increased 274 per cent. Mr. Towne. Yes; that is quite probable. No doubt he was speak- ing by the card. METHOD OP DIRECTING WOEK OF GOVEBNMENT EMPLOYEES. 25 Mr. Keating. It is the testimony of Gen. Crozier. You testify that that would be considered bad buisiness ? Mr. TowNE. Oh, no; you have got two things confused there, Mr. Keating. The 200 per cent — in come cases we have had 300 pjer cent. Mr. Keating. Then, the employee should get 300 per cent increase in salary ? Mr. TowNE. Not a bit of it. It is not due to anything he has con- tributed to. It is due to improved methods, sometimes improved machines and improved tools and improved methods, but the work- man has not contributed one penny. We compensate him for what he does — what is within his control and power to do — ^but we do not give the workman the benefit of it. For example, if, at the expense of .SI, 000, we throw out an old lathe and put in a new one, which will do twice the work. Mr. Keating. That really was not the question. Mr. TowNE. That is covered by Gen. Crozier's statement. Let me say right here that one of the reasons which appeal to me very strongly for urging this bill should not have your favorable con- sideration in the injustice it will work to the mechanic in the Govern- ment plants. In effect it says to them, " You shall be debarred from the privileges and benefits which your fellows of the same trade enjoy in outside plants." They are permitted, in a multitude of plants and a number that is constantly increasing, to come under the operation of this new and better and more scientific method of production and thereby to increase their wages 10, 20, and sometimes 50 per cent. You are proposing to pass legislation which denies that privilege to a man if he sees fit to work for the Government of the United States. Mr. Nolan. What would you say to the fact that the very men you speak of, in the only one establishment where this thing was put in to any considerable extent, are the people who originafly complained about it, and are complaining about it to-day and have even struck against it and sent delegations down here appearing before this com- mittee ? They sent delegations and appeared before the subcommit- tee of the House in the Sixty-third Congress and protested emphat- ically against it and pointed out their reasons therefor. You say we are going to deprive them of this, and the people you say we are going to deprive are the people who are working against it at the present time and are strongly protesting against it ? Mr. TowNE. Some of them. Mr. Nolan. According to the best information we have had there was not anybody who came forward to ask for its retention or that it be put into further operation. Mr. TowNE. According to the information I have there were plenty that were ready to do that; would have been glad to have done it. I believe the evidence of Gen. Crozier and his assistants would be more valuable there than mine. Mr. Nolan. In saying that, let me call your attention to the fact that the committee, composed of Secretary Wilson, Secretary Red- field, and Mr. Tilson, held their hearings at the Watfertown Arsenal and had every opportunity in the world to do it. Mr. Emery. Did not that committee report that no legislation should be had at this Congress after hearing that testimony ? 26 METHOD OF DIRECTING WORK OP GOVBKNMENT EMPLOYEES. Mr. Nolan. This gentleman here is testifying that we are depriving men of something they want. Mr. TowNE. I am expressing my opinion. Mr. Nolan. I want to show you that the men had all the oppor- tunity in the world to ask for it, and instead of asking for it th^ pro- tested against it. I say they had the opportunity to ask for its retention and to spread it to others, and they did not take advantage of this opportunity. Mr. TowNE. As I was not present at those hearings, of couree I am not competent to criticize what was said, but I have a very decided impression that- only one side of the situation there was effectively brought out, and for some reason I do not know what the other side saw fit not to present its case as effectively as it might. But I can make this assertion with absolute confidence, that in the course of time, if this better system of adjustment of compensation is for- bidden in the workshops of the United States Govenunent and is not illegahzed in the private shops, that you are going to find increased difficulty in getting mechanics to work in the public shops, because they prefer to work in the other shops where they can get better conditions. That is shown right in my own establishment, if you wiU pardon me again, where we are constantly — did more in the earher years when introducing this system, we had to do it slow; it is a matter of great detail and labor, and when it was only partly introduced in certain departments we were constantly petitioned by workmen in other departments to let them come in under it, or to hasten up the work necessary to bring them in under it, and that wiU be true, gentlemen, in any place where the system is carried out intelligently and fairly and the working people come to under- stand what it means to them_. Because do not forget that pri- marily, as Frederick W. Taylor, the chief apostle of this new art and science, emphasized all his life as the first proposition that the chief, the first purpose of scientific management, as appHed to the compensation of labor, was to improve labor's opportunities and labor's rewards. That was said again and again and always, and those of us who are in touch with his work and who are carrying it forward now can make the same statement, that increased compensa- tion for labor, better opportunities for labor, better conditions for labor to work imder, are all among the fruits of this new and better method. Now, the second thing. What I have discussed so far relates chiefly to the first two things. The other is the use of a bonus or premium system. What is a bonus in the sense that it is used in this connection ? It is a payment higher than the ordinary efficiency, whether due to skill or industry, effort or particular aptitude of the individual. There is no system which does not involve that element except the flat day rate, the compensation of employment of every kind whatever, every ?lace where there is exercised manual or mental or any other work, 'he only way to ehminate that is to pay a flat rate for so much serv- ice, a salary of so much a month, a wage of so much a day or an hour irrespective of what is accomphshed or produced in return for that payment. That is the old day rate, that everybody is desirous of getting away from and which has largely disappeared, which, in the industries I am familiar with, has been reduced now to about 30 per cent or less of the total wage payment; and the constant effort of the METHOD OF DIKECTIJN'G WOEK OF GOVERNMENT EMPLOYEES. 27 manager is to reduce that per cent, and the constant desire and wish of the empWees, as I have known them in nxjr long experience, is a preference, if they are on day wages, to get off of it and on to piece- work, if the conditions of the work make it possible. • .What is the effect of a bonus ? It at once accomplishes something that the advocates of this measure and the opponents of the system object to. It introduces discrimination in the reward of labor, be- cause the operative who is by nature better adapted to that particu- lar thing has more nimble fingers or a quicker eye or a little keener intelligence inevitably gets ahead as a result of these advantages and does something more than his neighbor who has not them and will begin to differentiate. That is what a bonus accomplishes. It is what is accomplished aU through life and ever since human life began on this planet. That efficiency, skiU, and ability, other things bemg equal, are recognized by nature and by man and carry their rewards, and most of us think it is right and should be so. It would be wrong to apply that principle if as a result those who are less fortunate in their natural gifts were punished and penalized in any severe and unjust way; but that is not the effect. , Mr. Denison. In the particular application of this system, does it include — I am talking about the particular application- — does it include ^elimination of those of the employees who do not come up to a certain abandard ? , . Mr. TowNE. It does. It provides for the earnings by the employees of that grade of about what is the normal, current day rate for that class of labor in that locality, with a premium or bonus for those who can do better, except where it is found that that person at a certain job is incompetent, disqualified for that — ^he may be very competent lor something else, but he is a misfit, when effort is made to find the right place for the individual, if he happens to get in the wrong place. That is one of the new things that scientific management determines, ■ the more intelligent study of the human unit to find the right place for each human unit, to fit him where he is under the best conditions and able to do things naturally intended for him to do.~ Mr. Denison. How does the system provide for determining what a man ought to earn in a particular line? What standard do you accept or take ? Mr. TowNE. The system does not determme that at all. That is a matter of current information and knowledge. Mr. Denison. That is what I want to find out. In the application of the system what standard Mr. TowNE (interposing). Take, for example, a piece of carpienter work, and in the locality you will find that the current rate of wages f&r carpenters is 40 cents an hour. That is the starting point, then, for fixing a piece rate for an operation that has got to be performed by a skilled carpenter. A carpenter of fair average skill at that place, at that piece rate, can make his 40 cents an hour, but if he possesses extra skill and high efficiency through some gift of nature, or idiosyncrasy he may be able to make more than that. Now, see what the result of that is and how he naturally benefits, unconsciously but not the less surely. The large factor in nearly all products of modern industry are those which we consume, clothes and food, used in homes, and so on, are -all made by machinery. The cost of machinery, the invest- inent in it, is a very large element, and the efl&ciency with which that i: 28 METHOD OF DIBECTIKG WORK OF GOVERNMENT EMPLOYEES. maoiuneryi is used in tTjrn becomes an important factor in the cost^ If you have a machine which costs $10,000 a day, it makes a good dea^ of difference in its utUity and output whether that machine is operated- six days a week or three days a week, and if the conditions are sueb that it is only effectively operated three days in the week, there is a resulting increased cost and burden to the manufacturer, whjeh h0 in turn tries to slip along to his customers. Now, under scientific management, by better coordination due to this more skillful planning of the work of the mechanic and the pro- visions for assisting that work, that machine is enabled to operate six days in the week instead of three, and there is indeed a large gsin to the employer, and it is out of that gain that the employer is able to Eay these premiums or bonuses for increased output and yet have fpr imself a substantial reduction in the cost of the product. Mr. Keating. On that point I find Senator Borah in making a report to the Senate on a similar bill, quoting from the book by J^. Taylor, makes this statement: When the writer (that is, Mr. Taylor) left the steel works, the Bethlehem piecfc workers were the finest body of picked laborers he had ever seen toge^er. Ihey were practically all first-class men, because in each case the task^ they Were called upon to perform, were such only as first-class men could do. The tas''cs were all made so severe that not more than one out of five laborers, perhaps even a lesser percent:^ than this, could- keep up. Mr. TowNE. Yes; I happen to know what Taylor was talking about in that case. It wes largely, partly at least, the handing of pig iron, the roxighest kind of manual labor, a kind involving perhaps more severe physical strain than almost anything else you can think of. Mr. Taylor foimd to his surprise that applyuig his analytical methods of study to the accomplishment of the work, and not pri- marily to determining piece rates at aU, but by seeing how it m^:;h,t be done best, that these men were wasting a great part of their energy, and, incidentally, their time, and that by overstrenuous work they were exhausting themselves physically and bodily. But they foimd also that many of the men who had been hired, substan- tially as day laborers, and turned loose in the plant for different fore- men to take had thereby drifted into work of this kind, utterly unsuited to men, for example, with rupture and men with tubercu- losis; men physically weak and physically unfit. He weeded out all men of that kind for that kind of work, and said to the employing office, "Put these men somewhere else, in a place where they will have work suited for them." Mr. Keating. Does that not strike you as being rather extraor- dinary Mr. To WNE (interposing). Let me finish, if you please. He then experimented with this particular piece of crudest sort of work, the lifting of pig iron, and determined the i-ythm with which each motion ought to t)e performed^ trained his gangs to do it in that way^ and found that he could increase the amount of work they did 30 40 and, I think, in one case 50 per cent, yet by having proper intervals of roppse, insistmg that the men should stop (and ior that purpo^ he used a wfttOT), that at certain intervlals, 5, 8, or 10>.min«^ whatever it might be, they should stop and^simply stand and rest' or sit down and then go on, they would accomplish a great deal more work in 60 minutes than by their previous continuous rnotion llrETHOD OP DIEECTING WORK OP GOVERNMENT EMPLOYEES. 29 and at the end of the day's work would be simply comfortably tired and not exhausted as they had been before. That is an illustration of what scientific management is trying to do to find out how to do better than before ; how to do best, if pos- sible, then to train the men to do the work in these new and better Ways, then to compensate them for it fairly in proper proportion. Mr. Keating. Does it not seem to be a trifle extraordinary that the system should result in the elimination of four out of five laborers ? Mr. TowNE. I am inclined to think that is an exaggeration. Mr. Keating. It is quoted from Mr. Taylor. Mr. TowNE. Yes ; but I doubt the fact. Mr. Keating. And he adds, ' 'Perhaps a smaller percentage than this." Mr. Emery. That men efficient or Mr. Keating (interposirg). I have quoted the exact language Senator Borah quoted in his report. He says: The tasks were all purposely made so severe. Mr. TowNE. Whose words are these? Mr. Keating. Mr. Taylor's book, paragraph 25, page 121. Tl e task.-) were all purposely made so severe that not more than one out of five laborers (perhaps even a smaller percentage than this) could keep up. Your suggestion r.bout enablirg them to perform the work in better or more efficient fp.shion of course applies to any intelligent fiif.n, yet I have often pondered that particular parPigraph. It seems to me that a systc-m which took a miscellaneous body of workmen and eliminated four-fifths is rather severe. . Mr. TowNE. May I translate it 1 Mr. Keating, dertainly, we shall be glad to have you do so. Mr. TowNE. Mr. Taylor Wf,s a great friend of mine and I regard him as having hsd done more as an American engineer in a genera- tion to leave an impress, which will last for all time, as founding a new system than any other man; but he had his faiUts, -like the rest of us, and one of them wp.s a very intense temperament) and as a result of that, a hf.bit of overstatement. He exaggerates, uncon- sciously but unavoidably, because he is so full of his subject and so intense. Now what was done there was undoubtedly to select the man most fit for this heavy Ir^bor's work, lifting, and to shift the unfit ones to something else they were bettor fitted for. Mr. Nolan. You say Mr. Taylor probably increased the work of those men 30 or 40 per cent in that instance ? Mr. TowNE. The result of their work. He reduced the amount of their work so that they did the work much more easily than before. Mr. Nolan. I will read bri(^fly from the record here exactly what Mr. Taylor said regarfirg how he increased the output of those men: ■When Mr. Taylor vnr'ertook to install his system in the plant of the Bethlehem Steel Co.. the lalDorers hanoUrg pig iron vrere receiving $1.15 a day to $1.85, or 60 per ■cent. W hen the Taylor sysleir' was installed finally the men were handling 48 tons per man per c'ay and the wapes of the fastest \^orkers had been increased to $1.86 per riay; thus it'will be seen before the installation of the Taylor system the laborers received 8.8 cents per ton. anfi after the installation of the system 3.8 cents pet ton. Those figures are -Mr. Taylor's figures from his testimony. Mr. TowNE. Yes; I have r,o doubt but that they are correcti 30 METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. Mr. Nolan. He increases the work 300 per cent; increases the wages from $1.15 to the fastest man $1.85. Mr. TowNE. And decreased the physical effort. Mr. Nolan. But it does not say that. It does not appear. Mr. TowNE. He has said it elsewhere. Mr. Nolan. But according to the statement read by Mr. Keating here from Mr . Taylor's own book, he made the task so hard that only a few men could undertake it. Mr. TowNE. Mr. Nolan, I have tried tomake what I am sure is a fair explanation of that. Mr. Emery. Pardon me, Mr. Nolan, that was not a quotation from Mr. Taylor. Mr. Nolan. The figures are from Mr. Taylor. Mr. Emery. I mean the language is not. You are reading some- body's else argument. Mr. Nolan. The figures are Mr. Taylor's. I did not read all of that. The most of it was my own language. Mr. Van Dyke. You say you have had this system in vogue 10 years in your plant ? Mr. TowNE. We have been at work 10 years introducing it, and are not through yet. Mr. Van Dyke. You could not tell then the per cent of increase in your output because of the system 1 Mr. Towne. No; because it is applied in our case to thousands of different articles. It has been very substantial, so much so that to bring it to a simple measure we had to expend about $25,000 before we could begin to see any return from it, and yet we were satisfied that the investment had been a good one and that the returns would come; and they did come; and that was perhaps after the second year. Up to the present time we have spent many times that amount, but the benefit has been so clear and obvious in every department and as to every product, that there is no shadow of doubt about the expediency of it. Mr. Van Dyke. Can you tell me this, the percentage of increase of the number of men in your plant or the decrease ? Mr. TowNE. The number of men in our plant has increased very largely, because the volume of business has increased very largely. Mr. Van Dyke. I mean proportionately to the business and output ? Mr. TowNE. No; I have no figures that would be of any signifi- cance there. Mr. Van Dyke, Neither could you tell us the proportionate increase per wage per man ? Mr. TowNE. Not from memory. Mr. Van Dyke. Could you submit those figures ? Mr. TowNE. I could submit some figures covering that kind of information to the committee and shall be glad to do so. Mr, Van Dyke, As I understand this bifl, of course, primarily it is to apply to Government employees entirely. Certamly it is' to apply to abuses which are being practiced in the Government service at the present time, and you have no objection to correcting any abuse which is in existence at the present time in the Govemmeirk service, have you ? METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 31 Mr. TowNE. None at all; on the contrary, I am glad to promote it. Mr. Van Dyke, We have, for instance, probably some 130,000 to 140,000 postal employees, and each branch of the Postal Service is being subjected at the present time to a time system, in which they use time-saving devices. For instance, on carriers they have a pedometer on the leg, and they time them in order to find out what is the quickest possible time they can cover a route, and the other men have to come up to that time, or have just recently, and they have been putting them back into the collection service or other serv- ice of that kind. In other words, there is no bonus system. It is all the other way. Tn the Railway Mail Service they have inaugu- rated a system whereby they take the heaviest night in the week, where primarily, or before inaugurating this system, they used to have five men on a crew, they put the hve men out on the heaviest night and reduced that crew proportionately each night according to the amount of mail. If they get an excess of the regular amount of mail on any one of these nights, these men have to speed up, prac- tically at the same rate as a man at an ordinary walk when he has to go on a dog trot, in order to clean up and distribute at this rate on their route. Mr. TowNE. Do you call this scientific management that you are describing? Mr. Van Dyke. I am talking about the provisions of the bill. The bill, as intended, says "time-saving device or system." This is a timing system. Mr. TowNE. Supposing under this system you have just described it is found out that a certain carrier on a route in New York City has 20 or 30 per cent longer route than it is supposed he had, due to his having to go into and out of corridors, as nearly all do in the lower part of the city, and that thereupon the department says, "Why here this rate is not just and fair; that man ought to have a higher rate or a shorter route. He is being treated unfairly." Would you object to the application of the system for that service ? Mr. Van Dyke. The bill as it stands at the present time does not take that into consideration, but it does take into consideration the abuses prevalent in the service at the present time, and all this bill seeks, as I understand at the present time, i's to correct those abuses which are prevalent in the Government service. As a matter of fact the bill does not state that even the Government departments can not time the clerks in order to discover the cost of operating at aU, but it does seek to prohibit abuses which are being practiced at the present time. Mr. Towne. Would you not try to eliminate abuses in both di- rections ? Suppose for example, the postmaster of New York City found on one particular route the carrier taking two hours, where his predecessor took only one hour, and he asked him about it and he said, "I can not do any better," and thereupon the postriiaster shoiild put some other carrier, in whom he had confidence, on the route and told him to take it a day or two and he found he could do it comfortably in one hour. Would you say that was a misapplica- tion of scientific methods ? Mr. Van Dyke. It has been my experience, after my varied ex- perience in the Post Office and other depa,rtments of the Govern- ment, that we never have to legislate along those lines; that all we have to legislate for is to prohibit abuses the other way. 32 METHOD OF DIRECTING WOKK OF GOVERNMENT EMPLOYEES. Mr. TowNE. Do you not think a case of that kind ought to be sub- ject to correction as well as the other? . Mr. Van Dyke. It is taken care of at the present time m the ser- vice. They have no bonus system, but they have a dement system or a plus and minus system. There is one way m that service by, which employees can obtain 500 plus points, that is by risking lue, but there are six distinct, different ways they can get 500 minus points. For instance, he can make a misstatement to his superior. It is abuses of that kind we are endeavoring to correct in this bill. Mr. TowNE. I should be with you most heartily m any legitimate effort to prevent abuses, but in preventing abuses do not let us legis- late good^ things out of existence, still less make them penal. Mr. l»JoLAN. On the question of fatigue and exhaustion, among the questions, it said, "Does scientific management undertake to study the question of fatigue and exhaustion and prevent it?" Mr. TowNE. It does in all cases of a natm-e in plying that element. Mr. Nolan. Did the committee that investigated for the Indus- trial Relations Commission visit your plant ? Mr. TowNE. No, I beUeve not Mr. Nolan. Have you ever read their report? Mr. Towne. I read part of it. I do not think I read the complete report. Mr. Nolan. Do you know that they went through 35 shops ? Mr. Towne. I am not sure ours may not have been among them. I am outside of active management now. Mr. Nolan. And they took about one year to make their investi- gation ? Mr. Towne. I know they made a long investigation. Mr. Nolan. You know that three men made a unanimous report on it and signed it ? Mr. Towne. I so understand. Mr. Nolan. I should just like to read something here and then ask you what you think of that investigation on the question of fatigue and exhaustion. Tnis is on page 218 of the final report of the (Com- mission on Industrial Relations and is as follows: ■When we come to the matter of fatigue studies and their comiection with speeding and exhaustion, the claims of scientific management seem to break down rompletely. No actual fatigue studies were found taking place in the shops, and the time-study men, who should be charged with such studies, seemed, in general, to be cuite indifferent or quit« igporant in regard to this vi hole matter. This does not mean that no attention to fatigue is given in sr ientifi c management shops. Cases were found w here the health and energy of the workers were carefully observed, and attempts were made to adapt the work to their condition, but the methods were the rough-and-ready ones of common- sense observation. Kest periods and modes of recreation during the working hours are a regular institution on an extended scale in but one shop xisited by the investigators. Isolated instances were encountered elsevjhere, but managers, in general, apparently do not even entertain the idea of their institution. Mr. Emeey. Is that not the report Mr. Basil Manly made ? Mr. Nolan. It is not the report of Mr. Manly. It is the report of Prof. Hoxie; it is the report of Prof. Hoxie with Mr. Frye and Mr. BaJlantine. Mr. Emery. I know that commission made an investigation, but I read that report, and my impression was that is Mr. BasU Manly's conclusions from their report. Mr. Nolan. It is nothing of the kind. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 33 Mr. Emery. Is it signed by them ? Mr. Nolan. The original report to them is signed. Mr. Emery. But that is not their language ? Mr. Nolan. Yes; this is their language, condensed. Their report is over here in the other room. Mr. TowNE. Who did the condensing? Mr. Nolan. They did themselves. They were confined to 40 typewritten pages. This is their report and none of these reports are signed by the investigators. Mr. Emery. What I am calling your attention to is that Mr. Basil Manly wrote that report and that is his language deduced from their inquiry and submitted to the committee. Mr. Nolan. Absolutely, no. Mr. Emery. Their names are not signed to it ? Mr. Nolan. No; but that is their report. Mr. Emery. It is signed by Mr. Manly. Mr. Nolan. The whole report of all these investigators, but this is the report of these investigators. The investigation of scientific management was conducted by Prof. Robert F. Hoxie, with the expert assistance and advice of Mr. Robert G. Valentine, representing the employpra' int rest in management, and Mr. John P. Frey, representing the in- terests of labor. The investigation grew out of public hearings h( id by the commis- sion during the spring of 1914, at which the almost unqualifird opposition of labor to scientific management was manifested. The purpose of the investigation was to test by the results of actual practice the claims of scientific management and the charges of the re^presentativps ot organized labor. As a result of their investigation, Prof. Hoxie, Mr. Valentine, and Mr. Frey submitted a report, agreed upon without exceptions, in which the statements and recommenda- tions which follow are embodied. Mr. Emery. Yes; I understand that. But that is a paraphrase there. If you will pardon me, the point I want to call your attention to is that Mr. Basil Manly probably reported on all those subjects and he deduced his conclusions from these documents, and Mr. Basil Manly's report you have before you was signed by four of the com- missioners and disapproved by five. Mr. Nolan. I am stating on the authority of the man who con- ducted this investigation that they were confined to 40 typewritten pages to be included in this report, and were included as they state it. Mr. Emery. I have had Mr. Hoxie's own statement that he did not write that part of the report, but he has since published his report, which I have read. It is printed by Appleton & Co., and is a very interesting report, but it does not support the condemnation contained in there. Mr. Nolan. My understanding from Mr. Fry is that this is the 40 typewritten pages they were compelled to condense their investi- gations into, and all testimony is over here in another room under control of this Committee on Labor. Mr. TowNE. May I sugg:est that there is an honest difference of opinion on this thing, but the best possible testimony you could have before this committee would be some of the men and women who have been working under this system. Why not let them come and testify ? • Mr. Nolan. The Congress of the United States appointed a com- mission and spent several hundred thousand doUars in investigating 36162—16 3 34 METHOD OF DIEEGTING WORK OF GOVERNMENT EMPLOYEES. industrial conditions in this country, and this commission saw fit to appoint some man who had no connection with labor or employers, and he was deputized to select two, one representing labor and one the employers, and to conduct an investigation of 35 shops, covering a period 6i over one year, and I think that Congress in- analyzing this question ought to take into consideration their investigations, and not the testimony of individual witnesses, as they found it, not upon the theory upon which scientific management is based, but upon its prac- tical application to industry and the human element involved. Mr. TowNE. Do I understand from that that your committee is unwilling to hear individuals on the bill ? Mr. Nolan. I did not say that. I say inasmuch as Congress appro- priated for this investigation, that this report ought to be given some consideration in the investigation. Mr. TowNE. Suppose the testimony of individuals would satisfy you that is right ? Mr. Nolan. I have not any objection to receive the testimony of individuals, but I am calHng your attention to a statement you have made here and to .the statement of people who investigated this very proposition, or the various elements of scientific management, and I want to ask you what you say to this report ? Mr. TowNE. I say that in my best belief it does not correctly rep- resent the views and sentiments of nearly all who are working imder what we call scientific management. I think in some way the com- mittee must have been misled; not have got the proper source of information. My urgent suggestion is that this committee allows some of these people to come here and tell their own story. I am sure other people will furnish a list; I will furnish one; let us pick out the names at haphazard and have them appear here. I think you will get more light than from any theoretical disciission. Mr. Van Dyke. May I ask the other two questions I have in mind ? One of those questions is this : Even if this bill were passed it would not become necessary for you to throw out the eflaciency system in your shops, would it ? Mr. TowNE. Oh, no ; this only applies to the Government arsenals, but we are apprehensive that if the Congress of the United States sees fit to put the stamp of crime upon these things, if performed in the Government arsenals, that it is going to become criminal for us to continue it in our private shops, and we want to forestall that if we can. Mr. Van Dyke. Of course you understand there are thousands of Government employees besides those working in the arsenals ? Mr. Towne. Yes, sir. Mr. Van Dyke. In fact, they are the minor quantity, taking into consideration the large work of Government employees, and that being so, do you not think it is rather hard not to legislate in order to correct certain abuses amongst Government employees ? Mr. Towne. Most assuredly, when you are satisfied as to the ex- istence of those abuses, but I tell you those abuses do not exist in the present case; this is all imaginary; you are shying at a shadow, and if you will take time enough and permit witnesses to •come here' who* have pf rional knowledge of facts and can testify concerning the facts you will see I am justified in my statement. ' METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 35 Mr. Van Dyke. Of course I have my knowledge upon the fact that I have a very intunate acquaintance with Government employees for 16 years; in fact I just left the service a few years ago, and I know absolutely that at the time the checking system in certain depart- ments was a nefarious proposition and there should be some legisla- tion or some action taken in order to stop it. Mr. TowNE. Let us stop that if that is wrong. Mr.. Van Dyke. And that is, as far as I am concerned ; I am endeav- oring to do this when I would vote for a report on this bill, because it applies to those employees. Mr. TowNB. As to the abuses in the Post Office Service to which you refer, I am not familiar with them. As to these operations in the Government plant at Watertown, I am fairly competent to speak on them, because those operations are fairly parallel with those in my industries and others I am familiar with; and, in effect, what you are f)roposing to do here is to pass a law, the effect of which would be a aw to promote inefficiency in. the Ilnited States service. Here we are to-day with most of the wbfld in a whirlwind of a gigantic war, with uncertainty as to when we may be drawn into it, as we all hope may not. be the case, but with the certainty that if W3 should bo involved we will need every ounce of national efficiency of every kind, and that whatever may be the result of the war politically, there is going to be an economic revolution afterwards which will sweep the whole world in its influence and concerning which wo do not yet know and can not yet foresee the effect upon this country, except to be very sure that anything we may do in the way of increased efficiency and preparedness is going to stand us in good stead, and probably will be needed badly. In the face of all these facts, to pass a law penalizing a system which overwhelmingly, as testified to, stands for efficiency, for economy, for better reward to labor, and higher production from labor and from machinery — in other words to not merely atop the wheels of progress but to set them spinning backward and say it is a crime — and we do not believe you will do it. Mr. Nolan. You realize, do you not, that .this biU is only aimed to do^away with the time study rand stop watch and bonus and pre- mium, which is a small part of the efficiency system ? Is that not a fact? Mr. TowNE. Mr. Nolan, I think I apprehend the scope and pur- poses of the bill as well as anyone. Mr. Nolan. Will you answer that question ? Is that not all this bill is intended to do ? Mr. TowNE. Yes; it is to stop the flow of the river at its source. Mr. Nolan. Do you think that the whole structure of the scientific management system demands that the stop-watch time-measuring device and bonus and premium system should be maintained ? Mr. TowNE. I think you can not have any fair and just payment of compensation for labor which shall be fair to labor and to the employer without the element of time being fundamental. It makes-no difference what kind of instrument you use to measure time, t do not care whether i'tda a clock, a stop watch, an hourglass, or anything else. Mr. Nolan. You say fair to labor. Then, if it was fair to labor, and men who have operated under it are opposing it, how can you reconcile that statement ? 36 METHOD OP DIRECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. To^NE. By the picking out of the witnesses. Mr. Nolan. I am talking now about the very men in the Govenir ment establishments we are seokiiig to eliminate it from. Mr. TowNE. And for one man of that kind; Mr. Nolan, I will enter under bond to bring 100 here equally qualified, qualified by experience, who will testify imder oath to the contrary. Mr. Nolan. Government employees ? Mr. Towne. No. What difference does it make whether a man is a Government employee or not ? Mr. Nolan. This has absolutely nothing to do with private employees. Mr. Towne. It has eveiything to do with it. Mr. Nolan. It has absolutely nothing to do with it. Mr. Towne. It has to do with me as a taxpayer. I do not want to pay taxes for inefficiency. Mr. Nolan. It has nothmg to do with employing any system you desire in your estabhshment. Mr. Towne. Not to-day, but if the Government says these acts are crimiaal, I am going to stop doing them. If they are criminal iii the Government shop, they are criminal in any private plant. Mr. Nolan. The Government has appUed the proposition of the eight-hour day to their establishments. Have you applied it to yours ? Mr. Towne. Largely. Mr. Nolan. To what extent ? Mr. Towne. Well, it varies in different departments. Some are on a 9-hour basis, some on an 8-hour basis, and they all used to be on a 10-hour basis. Mr. Nolan. You do not consider that criminal, do you? Mr. Towne. No; but it is not made a criminal offense. Mr. Nolan. Suppose the question of the penalty were stricken from the bUl, then would you object to it? Mr. Towne. I should. Mr. Nolan. It does not make any difference to you whether it is a penal offense or any other offense. You are opposed to it anyhow? Mr. Towne. Except with the penal offense retained, I think the bill is an outrage, but with or without it, it is a stultification and attempts to stop the wheels of progress and permit the Government to do things eflSciently and economically and ordering the Government to do that wastefully and extravagantly. Mr. Nolan. According to the letter 1 h?,ve here you are chairman of a board of 10 to oppose legislation antagonistic to efficiency m American industry? Mr. Towne. That is right. Mr. Nolan. That is a pretty broad statement, is it not ? Mr. Towne. That I am chairman? Mr. Nolan. No; but I mean that this bill is intended to, that this bUl is antagonistic to efficienecy in American industry? Mr. Towne. Does the article you are reading from make any reference Mr. Nolan. It rnakes the broad statement that it is opposed to legislation antagonistic to efficiency in American industry. Mr. ToAVNE. Yes; that is what we are for. METHOD OF DIKECTING WOBK OF GOVERNMENT EMPLOYEES. 37 Mr. Nolan. And you know that this 'bill has absolutely nothing to do with private employment ? Mr. TowNE. I submit it has to do with inefficiency in American industry because the Government itself is a part of American efficiency Mr. Nolan. But it has absolutely nothing to do with private emplojTQent? Mr. TowNE. We are opposed to Mr. Nolan. That is a pretty broad statement, is it not ? Mr. TowNE. Not a bit too broad. It is just what we mean — we are opposed to inefficiency in private shops and public shops; Ameri- can snops of any kind. Mr. Nolan. Who appointed this committee ? Mr. TowNE. A group of engineers, our membership collectively, representing most Anaerican societies of engineers. Mr. Nolan. Scientific management engineers ? Mr. TowNE. They were included in it and cooperated. Mr. Nolan. How wide a scope have you, or how broad has been your work in circularizing the country in solicitation of funds ? Mr. TowNE. As I have not been in New York for four or five days, I do not know personally, but our desire ultimately is to reach the country quite broadly in industrial circles. Mr. Nolan. Have you gone to private individuals also ? Mr. TowNE. I do not know: I did not compile the mailing lists. Mr. Nolan. Can you tell me how much money you received in answer to your circmar sent out asking for contributions ? Mr. TowNE. So far I think it is, to the best of my knowledge and belief, $65. Mr. Nolan. How long since you started sending those out ? Mr. TowNE. I did not send them out. They were sent out by other officers of the committee, but they have only been out a short time. We hope to receive funds enough to enable us to spread this information very broadly among the people that ought to know about it, because we know perfectly well that the public do not know any- thing about this subject. We are seeking to enhghten them. Mr. Nolan. You knew that they had also sent out in a letter, as follows : Should it occur to you to write your views to your Congressman, will youjdndly send us a carbon copy of such letter. Mr. TowNE. That is right. That is the way we beUeve in doing things, so as to help the IMfembers of Congress to understand the views and wishes of their constituents and enable them thereby to do their work better. Mr. Nolan. Then it is a country-wide propaganda to defeat this measure? Mr. TowNE. We hope to make it country-wide to defeat any measure designed to prevent efficiency in industry. Mr. Nolan. In the Government arsenals, that is what you term efficiency, and what the opponents of this biU term a just measure to stop labor-crushing methods Mr. TowNE (interposing). No; now I am not with you. Mr. Nolan. What do the proponents of this bill Mr. TowNE (interposing). I thiak this has turned into an argu- ment. I have got to go. 38 METHOD OP DIBEOTING WOEK OF GOVEENMENT EMPLOYEES. Mr. Nolan. I will say to Mr. Denison that whenever my time arrives to stop asking questions I will do so. I am willing to allow you all the latitude in questioning witnesses and do not want you to interfere with me. Mr. Denison. Go ahead and ask him questions. Mr. Nolan. That is what I was doing. The last question I asked was the difference of opinion between the people you are representing on this conmiittee and the proponents of this bill. You claim it is a blow at efficiency and American industry, and I say they claim it is a labor crushing method, a method of getting the last ounce out of the workers. Mr. TowNE. I am not authorized to say what they may think or claim. I am speaking to the facts, and I have simply to add that I have all respect for organized labor; I beUeve in it; I think organ- ized labor has been a great boom to the country in a great many ways. As a large employer of labor for nearly 50 years, I have tried to do my duty, at least, and I hope somethmg more, in promoting the welfare of the people in our plant and elsewhere, and any system of employment or of compensation which aims to overwork or to harass or to drive workmen or workwomen would have my condem- nation and opposition, but when it is proposed to legislate in a man- ner to prevent the further development, whether in Government or private shops, of a system whose primary purpose is to promote the general welfare and increase the wage-earning power of the working people, and which I know from personal experience and from wide observation and reading is bringing benefits to the workers, benefits to the employers, benefits to the community in which they work, and benefits to this country, which it is going to need, then I say that legislation of that kind is wrong, and I am going to oppose it, and I am going to circularize the whole country if I can do it to help to that end. (Thereupon, at 1.15 p. m., the committee adjourned until 7.30, Thursday, March 30, 1916.) Subcommittee of the Committee on Laboe, House of Repeesentatives, Thursday, March SO, 1916. The committee met at 7.45 p. m., Hon. Edward Keating (acting chairman) presiding. The Acting Chaieman. The committee wiU be in order. Mr. Nolan wishes to make a statement. Mr. Nolan. I have tried to get in touch with the Committee on Industrial Relations. Mr. Manly wrote the final report of the Com- mission on Industrial Relations, and I wanted to get from him for the purposes of the record, and for my own satisfaction, the final report of the Commission on Industrial Relations relative to the investiga- tion of scientific management, and I expect before the hearing is closed to get that information and have it for the benefit of the committee and the record. The Acting Chairman. It might be well to state that the com- mittee has decided that witnesses be permitted to make their state- ments without inteiTuption, and that after they have concluded their METHOD OF DIRECTING WOBK OE GOVERNMENT EMPLOYEES. 39 formal statement, members will be afforded an opportunity to present such questions as may occur to them, in order that we may facilitate the hearings. Mr. Emert. Mr. Chairman, in reference to the point Mr. Nolan has suggested, I want to make it clear, the character of the objection I made this morning to the statement that those portions of the report dealing with the subject of scientific management in the final report of the Commission on Industrial Relations represented recommenda- tions or conclusions or findings that had the support of the majority of the commission. The report prepared by Mr. Manly was not indorsed by the majority of tne commission, out on the contrary the majority of the commission, in a report beginning on page 307, declared: We can not find ourselves able to agree to any of the findings or recommendations of the staff or any resolution hased upon them, because they have not the criticism of employers, employees, and others affected by them, which we consider indispensable in order that we mi'At have before us assurances that they were accurate and not chargeable with important omissions. The report is signed by John R. Commons, Florence J. Harrimon, Harris Weinstock, S. Thurston BaUard, and Richard H. Aishton. That is what I alluded to this morning. Our next witness is Mr. Sanford Thompson, a consulting engineer of Boston, Mass., who has given much time and study to the subject of scientific management and has had personal experience with it for a number of years on a large and varied scale. STATEMENT OF MR. SANFORD E. THOMPSON", CONSTJLTINO ENGINEER, BOSTON, MASS. Mr. Thompson. In going over this matter I had planned to give a good deal as to the results and effects we have had with the subject under consideration, but after hearing the testimony this morning, and seeing how much thought most of you have been giving to the subject, I propose to cjonfino myself chiefly to a discussion of time study. I feel that we agree on a great many of the points that have to do with management. We agree certainly, all of us, that any method that overtaxes the worker is wrong. We agree that the out- put should be increased, because eventually it tends to reduce prices and to increase wages. We agree that unnecessary motions and op- erations should be eliminated. I think we agree that standard meth- ods should be established during work, standard methods of labor, standard methods for handhng materials, standards in the materials themselves. I rather think, although I am not so sure of this, because the bill as worded really prohibits it, that we agree on the fact that a man should be paid in accordance with his ability and the amount of work that he does. We certainly do agree in believing that we should have in our Government shops an efiicient and economical management. Now, of course yoiimaysay, Isn'tthat the whole thing? And it is to a very large extent! The trouble is just here, that we can not got a fair increase in output; we can't get at proper methods; we can't set standards without time study. The elimination of this really knocks industrial development right in the head, and it reaUy eliminates science. I do not know whether you realize that this lack of standardization is responsible for an immense amount of friction 40 METHOD OF DIKECTING WOEK OP GOVERNMENT EMPLOYEES. between labor and employers. Just to illustrate: Take, for example, the garment workers, those who make the women's garments, about which there has been so much in the papers lately, the strikes in New York and Chicago and the friction in Boston. I wonder if you have thought what one of the principal causes of this trouble is. I am speaking of this as an employee of a union. Mj. Valentine and myself are engaged in the employ of a union in which one of the objects is to make suggestions as to methods of standardiing the work in the trade. One of the principal troubles in the garment-working business is the diflSculty ot settmg piece rates. The rates because of their inac- curacy and because of the variation of the different garments and of the different materials and so on, are set in a very large majority of cases by guess, or what is the next thing, by trials that are simply very rough approximations. Consequently, both sides to the contro- versy try to get the best they can out of the bargain, very naturally. In one locality they have an arrangement by which the operators and the manufacturer get together and fix the piece rates. But a manufacturer told me not long ago that he had much rather have his work done, or have his special part of the work he was sp;aking about, done on a day basis rather than a piecework basis, although the day work would cost more, because of the friction and trouble m Betting these piece rates. I want to illustrate the difference between rates as set by the ordinary methods and rates that are set by time study. I am not going to take the garment workejs because we haven t got to that point yet. I want to take as an illustration, just to show you what time study is, and how it is worked out, the case of putting up a moulding such as we see around this room. Now, if you will count the number of corners in that molding, you will see that there are sixteen. In an ordinary room there will be four. You will see that there are different kinds of corners here that you don't get in an ordinary room. There is the inside comer, and outside corner, ex- ternal and internal, and there are other differences here. Now, the way ordinary piece rates are set, and this is practically the universal method of setting the ordinary type of piece rates, is to find out from the records the time it takes a couple of men to put up this molding. Take the time that it takes the men to put the molding in a room that has only four corners. Take the time that it takes for various other rooms. Take the time that it takes for a closet, where the corners come so close together that it is very expensive work. Do aU these and so get an approximate average of them, and then fix that as the rate for putting up the molding. Now, if a man was working in this room on that average — this, you understand, is an illustration. Molding is not usually put up as piecework, but it is an illustration which corresponds actually to setting of rates on different classes of work, where there is as much variation in different kinds of work as there is between this room and a square room we will say. When a man is working in this room he takes a great deal longer than the average time, and he gets a low rate of pay. When he works in a large room of this same size with four corners he gets a high rate of pay, and consequently there is a fluctuation and a variation in different pieces of work, and the man one day may earn one thiilg, and another day he may earn another. Or he may fix his speed according to the pay, so that he wiU earn about the same METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 41 on both rooms by working perhaps a little faster in this room and very slowly in the other room. At any rate, it is absolutely inequitable to the worker. I was through a silk mill the other day and I said to the man who took me around, *'What are these girls getting here on the looms?" "Oh," he says, "they get from $8 to $18 a week." "As much varia- tion as that ? " "Oh, some girls will vary from $ 1 2 to $ 1 8 . " I asked him why that was and he said that it was due to the difference in silk. Sometimes the silk comes good and sometimes poor. He couldn't tell anything about it. That was the cause of the variation. That mill is unsystematized. The making of silk is not standardized so as to provide for those variations in the setting of the rates. Now, suppose that we come back to this settmg of this molding and see what we would do on a time-study basis. Instead of taking the whole room at once, disregarding the character of the work, we take each thing separately and find how much time it takes to make one kind of a corner. We find how long it takes to make one kind of a corner, and how long it takes to make the other kind. We find how long it takes to cut a joint where the molding is spliced, and find how long it takes to put up the different pieces of molding. We find a few other variables. There are about nine variables, nine different units, for example, in putting up a molding. Now, having got those units, we are in a position to find out how long it ought to take to put up the molding in a square room, or a closet, or a room of this shape, because we know how long it takes for the differ- ent kinds of corners, for the sphce, and for putting up the short lengths, and the long lengths, and for that reason you can equalize the times, and you can get satisfactory rates or fix a time that is equitable. Now that is one feature. Another feature is time. If you take this room, time it altogether, take the whole time of doing it — and you must remember that ordinary piece rates, all kinds of piece rates are really set by time. If you actually take time out of the question you can't have any piece rates at all. In taking these times you find not only how long it takes to do each piece, but you go down into that and find the best method of doing it. You find, for example, that a certain kind of saw is easier to handle, easier to saw with than another, a saw with a certain kind of teeth you wiU find wiU do better work than some other kind; a certain type of hammer is easier to work with for that overhead work; you find that there is a certain method of handling stock, that by planning it out in advance you can bring it in to the man and make it easier for him to work with it; you find that you can get his tools to him; you find that you can plan out the work ahead and tell how long it will take in one room and how long in another, so that he wiU have less idle time between jobs. Now, for all these things time study is necessary, and one of the chief features of time study is not the actual getting of the times, to fix your rates, or to determine your standard time, but to actually standardize your work. Now, of course, there is an amendment to the biU which makes some difference in the wording, but I can't see how it affects this method of standardizing a time study. Perhaps some of you wiU have some questions on that point. We can discuss that more at length. Now, along w^ith this study" of methods and of the shortest ways of doing the work, the quickest way, and the study of how to eliminate 42 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. the unnecessary operations, comes the study of the fatigue element. Now, I don't Imow of any way to study fatigue, find out how much rest a man should have in a day, except to actually take time studies on him, and in scientific management work that is done right along, the taking of the time study very often through an entire day to see just how much rest the worker is takiag, find out whether he needs more rest than he is taking. In addition to that the time study affects the machinery. If you have a certain standard time in which to do a piece of work you have got to have the right methods and the right machinery in order to accomplish it in that time, and when you have the right method we find that if a man fails to do a certain piece of work in a standard time, it is more apt to be due to some trouble in the machinery or some trouble in the delivery of goods to him, or some trouble of that kind, than it is because he is not fast enough, and the making of the standard time, which of course is where the bonis and premium come in play, is essential to getting an accurate time in which he should do his work. The time study also affects the working conditions, because in making the time studies to see that these studies are carried out, the actual handling of the work is studied out very carefully. The atten- tion of the management is called to defective conditions in connection with the shops. The hours of labor tend to be reduced under scienti6c management and time study and bonus, for one reason, because the cost of pro- duction is reduced and therefore there is more opportunity in which to reduce the hours. I have here a letter written by an employee of the Acme Wire Co., of New Haven, Conn., and it gives the whole thing in such an inter- esting way that I am going to read a part of it. It is wi-itten to Mr. WiUiam Hamley, New Haven, Conn., and signed by Mr. Torwald Hoyer. He says : After I am over my surprise that intelligent people in our day can try to stop a method which very soon will show up as the only method under which the working- man will work in the future, I shall gladly and frankly state my experience of working under a bonus system. I started to work for a concern that was putting in a bonus system fTaylor system) in 1912. When I started to work the shop was still on daywork basis and all the jobs were daywork. I was at the time eamii^ $8 a week; but a few weeks later I was transferred to some part of the shop where they all worked on piecework. After a little experience I could here earn from $11 to $13; but when the whistle blew at night I would be all tired out because I started in full speed in the morning and kept it going as long as possible in order to get as big an amount done as possible; but I would always be too tired to go anywhere at night. After a while the company was ready to put the whole factory on the bonus basis and I started to work after the new system, together with the whole room At first we didn't like it at all; but after a week had passed we all found out that we weie not only making the same money and doing the same quantity of work, but we never got tired out as we used to do, because there was a certain time set to do the operation in, which made us start m with speed that would enable us to finish the job in time by keeping it gomg with that speed all day. We would most of the time produf-e more than we did under the piece system without being tired out, aud after the bonus system we would always be sure to get at least our day rate of pay even if we had bad luck with the work or didn't feel good, as we were always paid our dav rate even if we didn't make the job in bonus time (the time the operator Ls allowed for a certain operation). * * * The bonus system makes the wbrkii^man and his home happy because he don't come home from work all tired out. He also gets fair wages and working under home MKTHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 43 conditions with the same r%hts as his fellow workingman. Some people there will call those intelligent Cindeed, they are not) who have the same idea of a stop watch as the dpK of a whip. But if they had a little experience and used a very little commoa sense they would soon come to the conclusion that the only fair way to set the time for a joh is by a stop watch. : I think, Mr. Chairman, that I have some other notes here, but you sug^sted that the questions be left until the end of my talk. Sup- pose I stop here and see if there are any questions that may bring out points that I would make afterwards. The Acting Chairman. Begin on the left here. Mr. vSmith. In reference to the working on the silk, the illustration that you made there. Are you a manalacturer or are you employed for these unions as you state ? Have you ever been a mechanic ? Mr. Thompson. No; I have worked in a shop, if you call that being a mechanic. Mr. Smith. Do you know what a workman is and what a mechanic is? There is a difEerence between them. Do you claim that you ever acquired skill as a mechanic ? Mr. THOMPSON. No; I never worked very long as a mechanic. I worked in a shop two or three years. Mr. Smith. In relation to that sUk you say that the party could make oh piecework, the same party, $8, $12, and $18? Mr. Thompson. Yes. Mr. Smith. And that was on account of the difference in the quality of the silk? Mr. Thompson. Yes. -Mr. Smith. If a party would work just as hard on the poor quality of silk as on the good quality, do you think that that was fair to the workman ? Mr. Thompson. No. Mr. Smith. That was on accoimt of the quality of the silk. Now, why should not that workman receive $18 on a poor quality of silk just the same as on a good quality? Mr. Thompson. He should. Mr. Smith. But they didn't in the illustration you gave? Mr. THOMPSON. That is the old-fashioned tjrpe of piece rate that I am talking about. That is just what I am criticizing and that is just that sort of thing that our time study does away with. Mr. Smith. Then she would make $18 on the good quality of silk for the same amount of work as she would in working on the poor quality of sUk ? Mr. Thompson. Of course when you come to the question of the total amount received there are so many conditions that come in that I am not ready to say that all of those girls in the weaving room ought to earn $18 a week. I am inclined to think they should. I do not know enough about the case. But my point is that if the quality of the silk could not be changed, and supposing that the industry could not afford to pay all the girls $18 a week, that instead of some girls earning $12 a week some weeks, $18 a week in other weeks, they should all earn $15 all of the time. Mr. Smith. Well, if she worked just as hard on the poor quality of silk as she did on the good quality, why shouldn't she be paid the $18? She has put in the same amount of energy and the same amount of work. 44 METHOD OF DIBECTHiTG WORK OF GOVEENMENT EMPLOYEES. Mr. TflOMSPON. She should receive- that if that is a fair wage. But my point is that she should receive a uniform wage. Mr. Smith. Then we agree. I understood you to say that she would make only $10 on the poor quality of silk where she would make $18 on the good quality. Mr. Thompson. That is exactly what I am criticizing. Idont know as you get my point about it. It is just that variation from' one week to another in the old conditions, not in a scientifically managed shop. It was the old-fashioned method of fixing the rates, and it is extreme, because in ordinary piecework the changes in different jobs come more frequently, so it doesn't stand out so much as it did in this particular case, where he said they worked for two or three weeks on this low type of silk. Mr. Smith. Then, according to your method, this work lady would receive the same wages at the end of a week for working on the poor silk as she would for working on the good silk ? Mr. Thompson. Yes. Mr. Smith. I misunderstood you. Mr. Thompson. If she works just as hard. As a matter of fact probably she works harder. And I am not sure but what she ought to have more. Mr. Smith. You gave another illustration of putting up this mold- ing around the room. Could that be done by the time system? Mr. Thompson. Yes. Mr. Smith. How many different classes of workmen would it take to put up this molding around this room ? Mr. Thompson. A carpenter would do it. Mr. Smith. That is put up by cement or stucco. It is run into a mold. Mr. Thompson. No; that is wood. Mr. Smith. That is calcined plaster, lime and sand, and mortar. Mr. Thompson. I saw the jomt, and I saw it was very much like a wood joint, the upper one here, but that circle is not wood. Mr. Smith. But going back to the molding. In the first place fou must have a carpenter to make your gauge. You will have to ave a tender to br^ng your material up to him and put it on the board. Then you will have a mixer and then you will hawk and trowel and throw it along and grab your mold and run it, and the man that puts that molding up knows ]ust exactly what he can do it for. Mr. Thompson. I can carry my illustration forward into plastering, but my illustration was for wood molding. Mr. Smith. I thought you meant this one. Mr. Thompson. My illustration applies to wood molding. The same pr'ncple applies to molding which is made of plaster. Mr. Smith. I don t think you can apply it to a building operation. Mr. Thompson. I have. Mr. Smith. I do not see how you can do it if there are as many as 10 different operations in putting it in. Some men will put these miters up by taking a long strip. Others will run it in by hand. Mr. Thompson. 1 have myself taken time studies of plasterii^ of that k nd, and I have got some tables worked out which give the time for thrse different operations. Mr. Smith. I won t bother you any further except to say that some men can do twice as much work as others and put on twice as much METHOD OF DIBEOTING WOEK OF GOVERNMENT EMPLOYEES. 46 mortar, and lay twice as much brick. Some men can put them in with both hands, and some men can work a trowel with both hands, L tod when; ybu ..contract to put up that work you know how many toijednd bmk it is going to talse and you know just what & fair day's jrork is,.and^a~man knows what he can do. Any mechanic can tell {"ust what a day's work is. He will figure 5,000 brick in a dead wall mt not so many pressed brick, and you put your price up for that class of work. You don't hire your mechanic for the speed that he will make, you don't hire him for his speeding up* You hire him for his. proficiency, as a nice workman, and that gets him his next job. Mr. Thompson. I don't- think you understand just the way we analyze the results. Now, time study is just what you are talking about. , "Tinie study does take into account the quality of the man. it does take into account the difference in the men ana^e methods, and does it hj study. If you can analyze those thirgs^'aiid get them down to a uniform basis and get it so that a man will earn — if you put the thing on a standard time and fix it so that the man can earn a good day's wage, so that he can lay a certain amount of brick, for example Mr. Smith (interposing). What I wanted to say was that you VfcWld ;hare them because they were nice workmen and Hot because they '"^iSuld do so much by the watch? Mr., Thompson. That is true; but what I have said — I am not talkirg about speeding up in the least. I am not talking about how many brick a man could hustle and get out. I am trying to impress upon you that the time study is more necessary than any question of speed. In fact, when you come to the question of speed, as I have, said before, you have got to take the question of fatigue and ail things into account. But the time study gets at the best methods of doing the work, and it eliminates the unnecessary parts of the work. Mr. Smith. Let me give you just one illustration. When I was engaged in manufacturing, not so very many years ago, I had boxes put up in front of the nailing machines. I didu t have them up more than a day when the men began talking about a sweat block and I tore them down. Mr. Beowne. How did you use them ? Mr. Smith. When they made a bundle of shooks. I did it in good faith. I wanted to keep track of the number, but the workmeh would not keep track of them. They thought I was nmning a sweat block and I went around and tore them down. I had to keep track of. the niimber after they threw them out. Mr. Thompson. I have got a table here of bricklaying which shows the number of brick, different types of wall, and so on. Mr. Smith. I warrant you the men were employed for their effi- ciency and because they were nice workmen. Mr. SumNees. You want quantity, too; you want both, Mr. Smith. Brick have been made so long and workmen have been on that work so long that they can almost tell to a brick what a day's work is. "The Acting Chaieman. Isn't it a fact that a bricklayer can tell yrhether a man is efficient when he picks up a brick ? ; Mr. Smith. Absolutely. A good bricklayer will stretch his mortar ijong 10 feet and put in his bricks and lay 5,000 bricks a day in a 46 at-BTHOD OF DIRECTING W-OEK OF GOVERNMENT EMPLOYEES. dead wall. But if you are building a nice residence you are not looking for a man to lay a large number of bricks, but you are goriig to see that the bricks are laid right so that one brick will not cast a shadow on the other. Mr. Thompson. That table shows how the quantity of bn^ may- vary from 150 brick in a day at a normal rate of work for Roman pressed brick, may vary from that to 2,650 average day's work for backing up stone work. Mr. Smith. Average day's work ? Mr. Thompson. Yes; bonus work or anything else. That table was making a time study. It contains 8, 12, and 32 mch walls. Mr. Smith. That is all right, but you would have trouble about fixing the amount. Mr. SiiMNERS. Mr. Smith, oven you as a matter of fact fix it as 5,000 in a dead wall. Mr. Smith. Yes. . Mr. SuMNEKS. Then if you are going around to. see what yo,ur.man has done, and even though he has done a nice job, if he has' fallen down much below 5,000 you would want him speeded up a little. Mr. Smith. Some men you. would pay $2 a day and some men $5, and the $5 man might be cheaper than the other because he was expert. Mr. SxjMNERS. There is one question that I would like to ask Mr. Thompson. Mr. Thompson. There is just one fact on this point that I want to impress on you and that is that this question of time study and analysis is just what is used for this particular purpose that you are talking about, that is, to differentiate between different conditions and the difference in quaUty and the question of speed where speed can be used, and quality where quality is the essential thing. This method that I am trying to bring out is the important thing. Mr. Smith. I of course recognize that it is all right for the con- tractor to know what a day's work is, but I will guarantee that 50 years before you made that table his men knew what a good day's wofk was for a mechanic. Mr. Thompson. I have rim across a good many contractors and builders, and I never yet have seen one that could tell accurately how much brick his men were going to lay unless he had been on a build- ing of just that particular type. Just one illustration. ITiore was a certain building that was being put up with steel as a means of support, surrounded by brick, brick piers, and the workman or super- intendent who was on that job who was an experienced superin- tendent, who had worked aU his life on bricklaying, graduated up from a brick foreman, was completely thrown off his base. He had no idea how much brick those men ought to lay on those piers, be- cause he had not had this opportunity and experience on this kind of work. I was able with this time study to figure out just exactly ,what they should lay on that pier which he could not do with all his experience, and I never laid a orick in my life. Mr. Smith. I don't beheve that they laid any more brick after you figured it out than they did before. Mi. Thompson. This was not made for the purpose of making them lay more brick. It was made for the purpose of finding how much brick was an average. It didn't have anything to do wiQi the bonus METHOD OF DIEECTING WORK OP GOVERNMENT EMPLOYEES. 47 or speed of the ■workmen or anything else. It was for the purpose of finding how much brick was being laid by an average mason on average work of this kind. The time study does differentiate be- tween different methods, and carrying ifc further, which I have not done on this particular class of work, you differentiate between differ- ent motions, those which are quick and those which are slow, and you are able to piit the thing on a good basis. Mr. Smith. I think there is a good deal in what you say about the support you give your mechanic, eliminating a certain waste of time. If he has to go himself and get a drink at the pump, he doesn't get along as well as if his tender brought it to him. Mr. Thompson. Just to return to my illustration of the molding. Assume that this is a wooden molding. Mr. Smith. You will find that it is cement. Mr. Thompson. I am going to take a knife and find out positively. But assume that it is a wooden molding. Unless you take into ac- count these units and the different time that it takes to handle corners and straight work, you can not figure different rooms of different shapes. Now, that same thing applies — and I use it as an illustration — on all kinds of shop work, and machine work through- out the shop. The Acting Chairman. Mr. Sumners desires to ask a question. Mr. Sumners. I want to know what relationship there should be between the price per unit under the bonus system above the standard prod\iction and the price per unit within the standard production. Mr. Thompson. Will you repeat that question ? Mr. Sumners. Suppose eight units constitute the standard day. The man does nine imits of work. Well, within the standard he gets 20 cents per unit. What does he get for the ninth unit ? Mr. Thompson. Now, do you mean that as a standard time, the time in which he earns a bonus ? Mr. Sumners. No, sir; I tried to state it as clearly as I could. Eight units he must produce before he gets to the point where he has a chance to earn a bonus. Mr. Thompson. That is where he gets a chance to earn a bonus — that is, he earns', we will say, $1.50 a day and when he makes the 20 pieces he gets a 50-cent bonus, he would get $2 a day. Mr. Sumners. Let's stop short of the bonus. You don't seem to follow my illustration; I will try to follow yours. The Acting Chairman. If you will permit the chair to make a suggestion. Suppose in malang shoes you would consider that eight pairs constitute a fair day's work, and for that the workman received $8. Suppose he made nine pairs of shoes. Mr. Sumners wants to know how much he would receive per pair of shoes if he made eight pairs and how much he would receive if he made nine pairs. Mr. Sumners. It seems to me that ought to be a simple proposi- tion on a scientific system. You pay a man $8 for making eight pairs of shoes, and that brings you to the point where the man has a chance, if he produces more, to earn a bonus. Do you follow me there ? Mr. Thompson. Yes. 48 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. SuMNEKs. Well, when he gets to a point where he has a chance to earn a bonus — ^he has a chance to make another pair of shoes. Mr. EicHARDS. It would be 11.50. The Acting Chairman. Let the witness answer the (question. Mr. Thompson. It is a comphcated question. If it is straight piece work, he earns an additional amount for that. If it is under a bonus system, he may get more than that additional for the ninth pair. Mr. Sumners. He may get more than that? Mr. Thompson. Yes. Mr. Sumners. Which system do you recommend ? Mr. Thompson. I think perhaps right there, if it will not compli- cate things too much, I should explain the different types. Mr. Sumners. You may confuse us, but if you would answer my shoe question you would not con^fuse us a bit. , Mr. Thompson. I think I can perhaps explain. Mr. Sumners. Explain in ordinary language, if you can. Mr. Thompson. I think if you will let me just say a word with reference — — Mr. Sumners (interposing). We are thick-headed. We are not manufacturing men. You wiU have to make your explanation in our language. Mr. Thompson. If you will let me just exjilain to you the way the bonus system works. Mr. Sumners. We don't care so much about the route if you will just tell us where he ends up. Here is a fellow of average efficiency who makes eight pairs of shoes, and when he gets beyond that he gets a bonus. Here is another pair of shoes. What are you going to pay him for that. Mr. Thompson. Now, suppose for example, that eight pairs of shoes were the standard amount at which he earned a bonus. Suppose that his normal rate per day — what I am describing is the bonus system — Mr. Sumners (interposing). That is what I was asking about. Mr. Thompson. Suppose that his ordinary rate paid per day is $3 a day. Now, we will tell that man, "We wUl never pay you less than $3 a day whatever your output is. If you make eight "pairs of shoes, we will give you instead of $3, $4." Mr. Sumners. I wish you would Mr. Thompson (interposing). I beg pardon, T am coming to your point. After he gets to that point, after he makes eight pairs, how much does he get for the ninth pair ? ' Mr. Sumners. Not at all. You begin to pay him when he makes eight pairs and stop short of the bonus. I gave you an illustration. If you will follow it we can think together. Eight pairs of shoes is what the average mechanic makes and gets for it the average wage, and that is the basis of production. Mr. Thompson. At $3 ? Mr. Sumners. $8. We can keep even numbers. That is what the man earns during this standard day's work. You have got to have some foundation on which to figure. Now, then, after he has done that for which he would get 18, he produces another pair of shoos, which makes nine pairs of shoes. That last pair of shoes which he METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 49 has produced takes him beyond the basis of production and brings him within the realm of bonus. What bonus 1 Mr. Thompson. The way I would usually fix the bonus which he would get, he would get no bonus for the nine pairs. Mr. Sxjmnees. What would he get for 10 pairs ? Mr. Thompson. What is that ? Mr. SuMNEES. He would not get any bonus for the ninth pair 1 Mr. Thompson. What inducement has he to make the ninth ? The standard time is where we get twisted, or the standard amount of work that he gives. May we not go back to my Mr. SxjMNEKS (interposing). No; let us stay on mine. Mr. Thompson. The point is, you do not understand the bonus system ? Mr. SuMNERS. I want you to explain it to me. Mr. Thompson. Will you let me give an illustration, please ? Mr. Sxjmners. Can not you answer that question ? Mr. Thompson. No. It is on a piece basis. If it is a piecework scheme he would get one-eighth more. He would get $9 for the shoes. Mr. Sumners. Let us suppose it is not piecework, and he turns out one-eighth more than the average man. Mr. Thompson. That is not piecework? Mr. SxiMNBRS. Yes; not piecework. Mr. Thompson. What woiJd it be if it was not piecework ? Mr. Sumners. A day's work. Mr. Thompson. For a day's work he would get a day's pay and would not get any more. Mr. Sumners. What incentive is there for a man to increase his activities under your bonus system ? Where does your bonus come in? Mr. Thompson. That is just what I am trying to explain. Mr. Browne. Can not you explain that so as to put it on a day basis'? Mr. Thompson. Let us assume Mr. Browne (interposing). Put it 50 cents a day. Mr. Thompson. We will assume that a man is earning $8 a day, regardless of what he makes. We won't say anything about pairs of shoes or anything. Eight dollars is the standard day's wage. Now, we will say to a man that if he wUl make 12 pairs in a day that he will get $12. If he makes 12 pairs then he will get $12. If he makes 10 pairs, he gets $8. Now, the idea is that this standard that he works to, this $12 standard, is a high standard to work for, and a man will aim to get that $12, and will have the incentive to get this high pay, which would be higher than he would get on a piecework basis, be- cause the piecework would be on a smaller rate per piece, and instead of being at a dollar, say, per pair, it would be 90 cents, or something like that. You give him a high standard, and a high reward, so that he works for that reward, and he gets the $12 when he makes the 12 pairs of shoes. Does that answer your point ? Mr. Sumners. Yes, sir; but I can not see why you could not use nine hours. Mr. Browne. Mr. Thompson, are there any systems similar to the Taylor system in use in any of the European countries, Germany or England, or any of the European countries? Mr. Thompson. Yes. 3616a— 16 i . - , _ . ; 50 METHOD OF DIRECTING WOBK OF GOVERNMENT EMPLOYEES. Mr. Browne. Which ones? Mr. Thompson. In France th^y^ have done a little, a little in Eng- land, and a little in Germany. What I mean by a little is, according to the straight Taj^lor system. They have gone a good way in certain features, in certam features of the management. Mr. Browne. Is this system agreeable to laboring people through- out the United States, in private institutions? Mr. Thompson. Where it has been introduced, it is agreeable. I do not know of any cases where it is not agreeable, and I have got letters from a lot of employees similar to this one that I have here where they teU how much they like the system. Mr. Browne, Have you kept track of whether the accidents are greater ? Mr. Thompson. I have records and letters from employees in which some of them say they have kept records of accidents, and have got some records with reference to insurance that they have paid, and the tendency is for accidents to decrease. The reason for this is thait when you analyze your work and go into the details of methods and of machines, and so on, the whole adjustment has to be made so much better and there is less chances for accidents than there is under the old methods of management. The Acting Chairman. Mr. London? Mr. London. Without going into details, isn't scientific manage- ment calculated to simplify the process of production ? I say, without going into details. Mr. Thompson. Yes. Mr. London. That is the main object of scientific management ? Mr. Thompson. Yes. Mr. London. To subdivide a complex process into as many simple processes as possible. Mr. Thompson. To subdivide ; yes. I will say that tentatively. Mr. London. According to your technical language ? Mr. Thompson. Yes; that is true so far as studies are concerned, but not necessarily the subdivision of the work. For instance, we do not gel a different man cutting a corner and Mr. London (interposing) . But you subdivide a complex process into simpler processes ? Mr. Thompson. I do in the studies. Whether or not you do with your employees depends on the class of work. Mr. London. But it the work lends itself to that ? Mr. Thompson. Yes; but it lends itself to combination, too, because you can figure if a man is doing different types of things, you can figure it just as well, and you don't have to subdivide so much in certain cases. There is nothing in the time-study method that makes it more necessary or less necessary to subdivide. Mr. London. Now, is the bonus system essential to scientific man- agement or is it an improved method of stimulating work on the part of labor ? Mr. Thompson. I would say yes, as compared with other forms of payment, such as piecework. I would say that the bonus was not necessary to scientific management, for you can have scientific man- agement with piecework; but I would say that I like the bonus much METHOD OF DIEECTING WORK Of GOVERNMENT EMPLOYEES. 51 better, because it works much more smoothly, and the workers like it better, in my personal experience. Mr. London. Now, what are the essential features of scientific man- agement? After all, if it is scientiF.c, it should be simjrle; otherwise it can not be scientif.c. Mr. Thompson. The essential thing in scientific management is the actual scientific study and treatment of all features and parts of the work, including the study of the processes, the study of the methods of work, and the study of the times of doing work, time study in a broad sense covering the whole process. Mr. London. Here we have a definition of scientific management. Let us see if it meets with your approval. Scientific management includes the critical observation, analysis, and classifica- tion of all industrial and business phenomena, and the systematic application of the results of the resulting records to securing the most efficient production and distribu- tion of products, and to make preparations for future development. Mr. Thompson. I think that is very good. Mr. London. Then two other paragraphs follow: Its most permanent element is the mental attitude which consciously applies the principles of scientific investigation to all the phenomena of business, and the trans- ference of skill to all its activities. Now, in determining what should be paid to a man, do you start out with a minimum below which you would consider that you are doing a wrong to an employee ? Mr. Thompson. A minimum wage, you mean ? Mr. London. Yes. Mr. Thompson. Yes. Mr. London. You start out with the idea that a certain minimum wage is necessary ? Mr. Thompson. Yes. Mr. London. Necessary for what purpose, to keep the man alive ? Mr. Thompson. No. I don't call it a minimum wage. We don't have a minimum wage in the sense that it is a low wage. We have for the wage of a man the wage that is determined by the conditions of the manufacture, the local conditions, and all these other condi- tions just about the same way that you fix the wage in any business. Mr. London. Let us see, when you used the word "bonus" you used it in the sense of extra compensation, did you not ? Mr. Thompson. Yes, for extra compensation. Mr. London. What we want to know is, before you come to deter- mine what shall be the extra compensation, have you any method of determining what shaU be the ordinary compensation ? Mr. Thompson. No scientific method. Mr. London. No method. We are assuming that everything we say here is scientific. You have no method of determining what shall be the ordinary wage, have you ? Mr. Thompson. No; no more method than Mr. London (interposing). Than the law of supply and demand? Mr. Thompson. That is it. Mr. London. Now, if the law of supply and demand, or the par- ticular condition surrounding the labor market is such that the ordinary wage is not sufficient to enable a man to earn a livelihood, then your bonus would be on a false basis, would it not ? 52 METHOD OF DIBECTHiTG WOBK OF GOVERNMENT EMPLOYEES. Mr. Thompson. If the wage, the original wage- Mr. London (interposing) . If your original wage is inferior to your main standards, then the bonus would not be of nauch help to the worker. Mr. Thompson. Put it on the other basis that you spoke of, the basis of the law of supply and demand. If the wage is below that reqviired by the law of supply and demand Mr. London (interposing). No wage is required by the law of supply and demand. Supply and demand may determine what wages are to be paid at the particidar time and the particular place. What I am interested in is this: Employers and scientific experts decide upon methods of compensation, or are supposed to decide upon methods of compensation. They provide extra forms of com- pensation in the form of bonuses ? Mr. Thompson, Yes. Mr. London. What I am trying to get at is this: Is there any law or rule, other than the law of suppljr and demand, which determines what shall be the regular compensation of a worker ? Mr. Thompson. None that I know of; no. Mr. London. In other words, if the condition of the labor market is such that the regular wage is far below the minimum required to give a man the means to Rve, then you do not provide him with sufficient means to support himself under your scientific management ? I wonder if I express myself ? Have I made the question clear ? Mr. Thompson. Yes, sir; you have made it clear. You are getting into such an economic problem. Mr. London. That is the question in which we are interested; that is the prominent question. Mr. Thompson. I will say this, imder scientific management, the base wage is usually somewhat higher than the wage that is prevalent in the community. Mr. London. It is somewhat higher? Mr. Thompson. It is a little higher, but it does not fix it according to the working conditions or the minimimi wage question. Mr. London. In other words, in determining the efficiency of the human machine, you do not ask how much bread, how much food, how much shelter, how much recreation, or how much education that human machine needs in order to be an efficient machine, to start out as an efficient machine. You do not ask yourself that question, do you ? Mr. Thompson. We will have to say — I say no ; I will say no, we do not. Mr. London. In examining the ordinary machine which is used as a machine for producing things, you do examine the efficiency of the machine itself, don't you? Mr. Thompson. Yes. Mr. London. But you do not do it when it comes to the human machine. Mr. Thompson. Well, now, I am going to Mr. London (interposing). That is a simple question. Mr. Thompson. What is that? Mr. London. I say it is a simple question. Mr. Thompson. Tiie trouble is on that sort of thing you can not get away, as I can see, from the law of supply and demand in fixing wages. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 53 Mr. London. We will leave that to the political economists of the orthodox school. Mr. Thompson. You have got to take that into consideration. Mr. London. We will leave that to the old economists. You are new scientific managers and the teachers of the new law of econonaics, aren't you? Mr. Thompson. We do not claim to be perfect. Mr. London. I know; I do not expect you to be perfect. Mr. Thompson. I will say this, that scientific management goes further in that sort of thing and in making careful studies of the worker and in pajdng them enough earnings that they will be in satisfactory condition and have better living conditions than anj. other method that I know of, and that is taken into account, but it is not taken into account scientifically. We have not got so far as that. Mr. Feist just says that he does do this; that he takes stock of this every hour, and he is going to testify to-morrow morning, and he will explain that. Mr. Nolan. We are trying to get the testimony here which each one of you gentlemen gives. You are put on here as witnesses, and I will suggest that each one of you answer at the time, if you can. Mr. London. I am trying to get at the essential facts in this scien- tific management movement. Large industries will, of course, seek to adopt every new method that will suggest itself as an efficient method, as a more productive method; but in dealing with the human machine, in dealing with the whole people, we are particularly interested in the question whether these new scientific methods start out with the proposition that they must first of all supply the worker with sufficient means to earn a livelihood. In other words, we have no use for any efficiency method that does not start out with that fundamental proposition. Do you get me now ? Mr. Thompson. What are you going to do ? Are you going to throw all methods and all of the basic things away, or are you going to adopt them as the best we have, with the idea that the method which does do these things in a scientific way is going to take into accomit these very things that jou talk of ? I will say frankly that I have not done that, but that it should be taken into accoimt in a broad sense; that the whole problem should be figured_out, and the researches and study and investigations tend toward taking the whole thing into account. Mr. London. I am afraid I have entered upon a discussion, and I will give somebody else a chance. Mr. Nolan. Are you an efficiency engineer? Mr. Thompson. I am a management engineer. Mr. Nolan. Do you install an efficiency system under what is claimed to be scientific management ? Mr. Thompson. I install scientific management. Mr. Nolan. Might I inquire whether you install the Taylor system or the Emerson system, or a system of your own ? Mr. Thompson. The Taylor system. Mr. Nolan. You are engaged in installing the Taylor system ? Mr. Thompson. Yes, sir. Mr. Nolan. How long have you been engaged in that work, Mr. Thompson ? 54 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. Thompson. I have been interested — that is, either in installing or in work connected with the studies of the Taylor system, for 20 years. Mr. Nolan. You stated you worked in a shop. Did you have any mechanical training, either before or after you had adopted this profession ? Mr. Thompson. I graduated at the Institute of Technology, and I worked in a shop after I got out from there, a mill, for two or three years. Mr. Nolan. Were you employed by Mr. Taylor ? Mr. Thompson. I did engineering work. How is that ? Mr. Nolan. Were you employed by Mr. Taylor ? Mr. Thompson. At one time, yes ; I have been associated with him for a good many years after this. Mr. Nolan. But you are now in business for yourself ? Mr. Thompson. Yes. Mr. Nolan. You spoke of taking up the work for some imions. I just only want you to indicate the name of the imion. I do not know that you stated it at the time you started out ? Mr. Thompson. I do not know that I am at liberty to say that. It was a private matter. Mr. Nolan. Well, of course, we do not want you to divulge any confidences. I did not know but what it was common knowledge ? Mr. Thompson. I had just as soon tell you personally or other members of the committee. Mr. Nolan. I just thought probably you overlooked stating the name of the organization ? Mr. Thompson. No. Mr. Nolan. You spoke of a Mr. Valentine ? Mr. Thompson. Yes. Mr. Nolan. Is he associated with you in your firm ? Mr. Thompson. No; except this one particular proposition, he is not associated with me. Mr. Nolan. Is that the Mr. Valentine Mr. Thompson (interposing). Robert G. Valentine. Mr. Nolan (continuing). That was associated with Mr. Hoxie and Mr. Frye ? Mr. Thompson. Yes. Mr. Nolan. He is a scientific management expert, or engineer? Mr. Thompson. No; he is an industrial expert. That is, that is what he gives his title as. Mr. Nolan. Is he engaged in similar work with you ? Mr. Thompson. No. Mr. Nolan. As I understood you, you said that the only way in which you know to test the piece prices was through the stop watch or time study — the only sensible way? Mr. Thompson. The only accurate way; and, yes, the only sensi- ble way. Mr. Nolan. And you said that you did not know of any way that was in existence in the matter of setting prices on a large scale, piece prices on a large scale, without the stop-watch or time-study system ? Mr. Thompson. On most classes of work, yes; as a general propo- sition; that is, I do not know of any way of setting them accurately. METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 55 Mr. Nolan. Do you know anything about the system adopted by the stove, molders and their employees, the members of the national association in the stove shops? Mr. Thompson. No ; I do not. Mr. Nolan. Do you know that they have had a system of setting prices for 26 years ? Ml'. Thompson. I understood that they used the stop watch — in setting Mr. Nolan (interposing). I will disabuse your mind on that. They do not use it, and the men would not stand for it for a moment. I happened to be a party to it on one part. That is why I make that statement so emphatically, that there is no such thing as a stop watch, or a watch of any kind, used in the setting of prices in the stove shops; and I would advise you to become familiar with their system, so that you will see that there is a system in vogue in this country which has in effect a common-sense method of setting prices between employer and employee. Mr. Thompson. You will notice that in general I qualified that statement, that I did not know of any system, that I did not know any way in which it could be done, except by a stop watch. I said for most classes of industry. Mr. Nolan. If a class of work such as a stove business, which is more or less of a representative character, and which is ready at all times to accept advantages in methods of holding — and one stove is almost the same as another stove, except for the design, and the form, or something like that — they have set piece prices for 26 years, and never attempted to use a stop watch. Mr. Thompson. May I ask a question? It involved how long it would take to do the work, did it not ? Mr. Nolan. The whole thing is set on a time basis. Everything is done by comparison. Mr. Thompson. Comparison as to how long it would take ? Mr. Nolan. No; comparison on a similar line of work. Mr. Thompson. As to how long it would take ? Mr. Nolan. No; as to what other work pays; and if there was any improvement in the new job, as to whether it ought to be more, or if there was a benefit to the employer. Mr. Thompson. As to how much he ought to receive 1 Mr. Nolan. Yes. Mr. Thompson. And that is based on the time that it takes. Mr. Nolan. Yes; that is based on the time that it takes. Mr. Thompson. So that you really get down to the time basis as we do ? Mr. Nolan. You get down to a common-sense method of com- puting time. Mr. Thompson. But it is a time basis ? Mr. Nolan. Without a time-measuring device or a stop watch. Mr. Thompson. You use an ordinary watch? Mr. Nolan. You do that in a day's work. Mr. Thompson. Yes. Mr. Nolan. There is not any objection, I do not think, to the fact that a man will say that this job ought to be done in an hour. If you work eight hours, you ought to make eight of them in eight hours. 56 METHOD or DIRECTING WORK OP GOVERNMENT EMPLOYEES. That is a fair day's work. That is the common-sense method of set- ting that, but this bill seeks to ehminate the spht-second stop-watch timing. Mr. Thompson. Your time on this particular class of work — it might be that you can get your time near enough by your over-all time; that is what your time is based on. Mr. Nolan. In other words, to make it as short an illustration as possible. There is not any difference in setting prices in the stove shop and setting a day's work in an ordinary foundry. The proposi- tion is left to the men, employer and employee, to come to some sort of a mutual understanding on a common-sense day's work, mutually satisfactory to both parties, and the element of time always enters into it. Mr. Thompson. That is, requiring a certain amount of work in molding. Mr. Nolan. In a day, or setting the piece price. Mr. Thompson. Then, you really have a bonus for a standard time just the -same ? Mr. Nolan. Everything' is time. Your day's work is time. The number of your hours is a certain amount of time. So time always enters into it. Mr. Thompson. The only distinction that I can see in this particular class of molders — different types of work are so closely allied that you generally have to get down to the units. My point is this, that whereas in this particular type of work you may not need this in 99 cases out of 100, in order to fix your standard time, you have abso- lutely got to go into these detailed units in order to get it accurate, and if you do not get into these accurate units, you will not get the correct time. Mr. Nolan. Let us get right down to the essential basis, as I under- stand it, about this stop watch and time-measuring system. Under the piece-price system that I illustrated, the man that performed the operation, or the operative, as you call him, is taken into considera- tion, and bargains with his employer. Under your system the indi- vidual or operator has nothing wnatever to do with the setting of the price. Is not that a fact ? Mr. Thompson. The price is set by the time study man. There is no objection Mr. Nolan (interposing). And the operator is not consiilted as to whether that is satisfactory to him or not. It is satisfactory; is that not right ? Mr. Thompson. He has a right, though — as far as the setting is concerned, it is a matter of scientific study, and the actual time is taken. Mr. Nolan. That is what I wanted to get at. Is not that just exactly the great complaint among the operators, the men that do the work, that they are not taken into consideration at all in the question of fijcing the hourly rate, or the day rates^ or the task, or the amount to be paid by the piece ? Mr. Thompson. I am glad that you brought that up, Mr. Nolan, because I never knew any objection on the part of the operators to any of those things, and I have been in a great many cases. Mr. Nolan. Isn't that for this simple reason: That it is not your business ? METHOD OF DIREOTIKG WORK OP GOVERNMENT EMPLOYEES. 57 Mr. Thompson. What is not? Mr. Noj^AN. To deal with the operatives. Mr. Thompson. Oh, yes; it is. Mr. Nolan. Let us see whether it is or not. When you go into a shop and apply this system, J^oucome in under contract with the employer. Is not that a fact ? Mr. Thompson. Yes. Mr. Nolan. And you are employed by him ? Mr. Thompson. Unless I am doing it for the unions. Mr. Nolan. Yes; but I am talking now generally of how the sys- tem is installed. It is the first time I ever knew that any organization had taken advantage of this system; but the ordinary way is that the employer or owner, or the manager of the corporation, employs an efficiency engineer to go into his establishment for the purpose of applying scientific management to that establishment. Mr. Thompson. Yes. Mr. Nolan. Wherein do you, as the director of your system, or one of your time study men, constilt or confer with the employee himself ? Mr. Thompson. They consult with the time study men at every step; I mean, with the operative at every step. Mr. Nolan. As to the amount of time he took ? Mr. Thompson. That is determined by the watch. Mr. Nolan. Then how do they consult him and why do they con- sult him ? Mr. Thompson. They consult him as to the methods of doing a thing, and as to how the work is progressing, and as to whether it is tiring him and as to how he is getting along. Mr. Nolan. Do they consult him or advise him ? Mr. Thompson. No; they consult him; they ask him. Mr. Nolan. Are you willing to stand on that statement? Mr. Thompson. Yes. Mr. Nolan. Then probably we will get somewhere. Mr. Thompson, what training does the ordinary time-study man have to qualify him for this important work ? For instance, I want to make it clear, so that there will not be any issue here. You want a number of time-study men in connection with your business. What training or what instructions do you give them to qualify them for this work, so that they will study the movements of a man by timing with a stop watch, and also take into consideration the amount of energy used, the question of exhaustion, and all of the human element involved in the work of an individual when he is under this stop-watch system, as to what should be a fair day's work for the employer and what should be a reasonable task — what training do these men get? Mr. Thompson. My associate, Mr. Lichtner, has been'in time-study work for a great many years, and if we go into a shop in that way, he takes charge of the time study himself, and he directly trains the time- study men who are working in that shop. He shows them how to do it, and he takes time alongside of them, and he works up their time and shows them how to do it. Mr. Nolan. How long does it take the average man, or how long do you give instruction to the average man, so that he might be con- sidered proficient to be a time-study man ? 58 METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES. Mr. Thompson. That depends upon the type of man, of course, and he has got to have a good foundation — that is, he has got to be a man who is capable of handling that work ; whether he is a mechanic. Sometimes we take a time-study man from the shop; sometimes we take a man from outside who has had experience in shop work of different kinds. We take him usually if we can from the shop where we are doing the work. Mr. Nolan. How long does it take ordinarily to instruct one of those men so that they are proficient ? Mr. Thompson. With the proper training, possibly a couple of years before you can reasonably be sure he can go it alone in good shape. Mr. Nolan. Do vou take him under your wing all of that time ? Mr. Thompson. Yes. Mr. Nolan. In the shop ? Mr. Thompson. Yes. Mr. Nolan. Suppose you have a number of them; how do you work that out ? Mr. Thompson. A number of shops ? Mr. Nolan. A number of men in any particular shop. Mr. Thompson. In the same way. Mr. Nolan. Do you take them in groups, and instruct then* ? Mr. Thompson. Individually. Mr. Nolan. Do you have any group of men connected with your establishment who are time-study men ? Mr. Thompson. Yes. Mr. Nolan. How many? Mr. Thompson. Well, 1 have several. I make it a plan when I take hold of a piece of work to have the man on the job who under- stands time service pretty thoroughly, even if he does not do the detail work. Sometimes he may and sometimes I may employ other men. Mr. Nolan. Coming back to that proposition of taking two years to educate a time-study man in an establishment. .You pick out some man in the establishment or a man from outside whom you think is qualified and put him in there. Mr. Thompson. Yes, sir. Mr. Nolan. And he is the time study man for the establishment. Is that right ? Mr. Thompson. Yes. Mr. Nolan, It takes two years to educate him to do that work ? Mr. Thompson. That is, roughly speaking. Some kinds of work he can learn to do in less time and some kinds more. Mr. Nolan. That man has to do with the setting of a task, com- puting the day's work for the men in that shop during those two years that he is becoming drilled and trained as a time study man ? Mr. Thompson. Very little until toward the end of the two years. That is, I always plan to have the setting of the "task directly under myself or my associates, or one of my experienced men. Mr. Nolan. How long after you go into that shop do you start in to put the task system into effect ? Do you start to do it immediately, or do you wait until these men are qualified to set those tasks, and ao you wait two years to do that, or do you start in from the beginning ? Mr. Thompson. In some places you have to wait two years before you set any task, and in others you start inside of three or four or five months; not usually before six months. METHOD OF DIBECTING WORK OP GOVERNMENT EMPLOYEES. 59 Ml". Nolan. You say here that no tasks are set ordinarily under this system until five or six months, and from that until two years ? Mr. Thompson. That is my practice, yes. Mr. Nolan. That is your practice? Mr. Thompson. Yes. Mr. Nolan. Of course, I would only ask you from your own prac- tice. You do not start to ptit it into effect, and the men do not attempt to work under it. In other words, you do not cut down the time on a job. You do not apply the knowledge acquired through the stop watch, time study, and other methods that are used to deter- mine results under this system until after five or six months ? Mr. Thompson. Yes. Mr. Nolan. The men go along in the old groove all of that time ? Mr. Thompson. Yes. Mr. Nolan. And nothing is attempted 'to be done with them ? Mr. Thompson. The point is that in order to get ready for this there is a whole lot of other parts of the work to be done. You have got to have a standard; you can not begin to take time studies right away for the purpose of standardizing materials and the employees. You have got to get the supply of materials in shape; you have got to get your materials so that they are standard. Mr. Nolan. You are standardizing the work of that estabUsh- ment when you go in there ? That is a part of your work ? Mr. Thompson. Yes. Mr, Nolan. It does not make any diflference where it is out of line, it is your duty to find out just where it is out of Une and to stand- ardize it ? Mr. Thompson. Yes. Mr. Nolan. What I want to get at is, how long, ordinarily, does it take from the time you enter the shop before the men go to work^ ing under this so-called time-efiiciency system? And the time it takes to educate these people to their jobs ? Mr. Thompson. The time is six months to two years. Mr. Nolan. Do you know whether Mr. Taylor followed that same idea or not), always ? Mr. Thompson. I think so. Mr. Nolan. I did not catch the name of the city that that letter came from up in Connecticut. Mr. Thompson. New Haven. The letter is dated WhitneyviUe, Conn., but he works in the Acme Wire Co., in New Haven. Mr. Nolan. Have you undertaken to standardize that silk mill that you spoke of a whUe ago ? Mr. Thompson. No. Mr. Nolan. If not, I do not believe I ought to ask any questions on it. I was going to ask you, but inasmuch as you did not have an opportunity to study all of the conditions there, I think it would be unfair. You stated that you did not know of any instance where scientific management had been installed to any considerable extent where your employees made any complaint. Did I understand you aright to that extent ? Mr. Thompson. I know from hearsay that the Watertown Arse- nal — that some of the men made complaints. I am speaking about my own practice, and other shops that I have known about directly that I have been in, and that I have been associated with either 60 METHOD OF DIKECTING WOEK OF GOVEEIirMEjrT EMPLOYEES. directly or indirectly and been through, and I never had any experi- ence of that kind. I do not know anything about the Watertown Arsenal situation, and so I am not qualified to answer any questions about that; but I will say this, that if it is a fact that the men at the Watertown Arsenal dislike the system — and I am not at all sure that they do — it is an extreruely exceptional case. I have got himdreds of letters— I will not take time to read them now — but I have got a lot of letters from employees similar to this one which I have read,- showing actually what they think about it. Mr. Nolan. Inasmuch as I did not have a chance to get a line on that last question, I want to ask you one more. Mr. Sumners here put a hjrpothetical question regarding something in relation to the premium or bonus system, and he cited a case where a man might make eight pairs of shoes a day and receive $1 per pair. That is, eight would be the task set under time study. Ms. Thompson. I said 12 would be the task. Mr. Nolan. But get it down to Mr. Sumner's question. Mr. Sum- ners put a hypothetical question here about eight pairs per day; that is, provided you went into an establishment and you decided that eight pau-s of shoes a day, after careful study, was a task for the individual man. Mr. Thompson. And required a bonus payment ? Mr. Nolan. JRast a moment. And he was receiving a day's pay of 18 per day, and you were required to set a day's work for that $8. What did you say he would receive providing, after produc- ing the task suggested by you, he should produce one pair more, making nine pairs — what did you say he would receive for the ninth pair? Mr. Thompson. I have to ask you again whether $8 is his daily wage ? Mr. Nolan. Ye&, sir; that is it. Mr. Thompson. I would say again that by the premium system he would get one thing; by the bonus, another. By the bonus I would say — that, you say, is a day's wage — the point is right here. Mr. Nolan. Let me get this question right here. Say he was making |8 a day and only making five pairs of shoes ? Mr. Thompson. Yes ; that is better. Mr. Nolan. He was getting %8 a day ? Mr. Thompson. Yes. Mr. Nolan. And he was making five pairs of shoes a day ? Mr, Thompson. Yes. Mr. Nolan. You went in there at the request of the manager ? Mr. Thompson. Yes. Mr. Nolan. To install the system ? Mr, Thompson. Yes. Mr. Nolan. After installing the system you set, according to your time studies, eight pairs of shoes as a day's work, a task. Mr. Thompson. Yes. Ml'. Nolan. And he would receive for that the basic rate of $8 ? Mr. Thompson. No. Mr. Nolan. Hold on. Mr. Thompson. That is wrong. Mr. Nolan. Let us see whether it is or not. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 61 Mj. Thompson. We never set a task on a piece base work. We' set the task on what he ought to have done if he had done an especially good day's work. Mr. Nolan. You do set tasks under the daywork system ? Mr. Thompson. No. Mr. Nolan. Well, the Taylor system does ? Mr. Thompson. Yes, but not for a day's work. He gets his day's pay out of what he does, and if he does the standard amoimt of work he gets $9, we will say. Mr. Nolan. Your system means that you would go in there and you would introduce new methods 1 Mr. Thompson. Yes. Mr. Nolan. Whereby you say that that man would not do any more to accomplish Mr. Thompson (interposing). That is, would not work any harder f Mr. Nolan. Would not work any harder, and that you introduced scientific methods whereby that man, instead of producing five pairs of shoes a day, would be enabled, with the same effort or less effort, to produce eight pairs of shoes a day ? Mr. Thompson. Yes. Mr. Nolan. And that you were in there for the purpose of taking up the slack, if we can use that term ? Mr. Thompson. Yes. Mr. Nolan. And supplying scientific methods to meet the output, and you do meet the output, so that that man did not have to use any more energy in the production of eight pairs of shoes than five, you would not change the pay ? It still remained at $8 ? Mr. Thompson. I would not do that. Mr. London. I think the figure "8" is too big. We are all get- ting confused. Mr. Nolan. To show that this system, as this committee has got it of the proponents of the Taylor system, and I think as Gen. Crozier would probably testify, as he will if he is here to-morrow, and as he has done in days gone by, that they introduced methods in the Watertown Arsenal whereby the production of the individual worker, who was receiving $3.24 per day, was increased 274 per cent. Mr. Thompson. Yes. Mr. Nolan. Now, for that increased production he only got $3.24. Mr. Thompson. What was his wage before ? Mr. Nolan. $3.24. Mr. Thompson. You mean he got the same wage during this time ? Mr. Nolan. Yes, sir. Mr. Thompson. There I think you are absolutely wrong. Mr. Nolan. We can take that from his testimony. Mr. Thompson. I think you will find that he got one-third more. Mr. Nolan. No; after they set the task. Mr. Thompson. When they set the task they gave him an extra amount ? Mr. Nolan. But Gen. Crozier took the position that they intro- duced new methods. Mr. Thompson. Yes. Mr. Nolan. That made it possible for the man to produce this much more? Mr. Thompson. Yes. 62 METHOD OF DIEECTING WOBK OP GOVEBNMENT EMPLOYEES. Mr. Nolan. Without any increased effort on his part? Mr. Thompson. Yes. Mr. Nolan. And that the United States Government was entitled to that 274 per cent increase of output because it was not — — . Mr. Thompson (interposiag). At the same pay that he was getting before ? Mr. Nolan. Yes. Mr. Thompson. Absolutely no. I am dead sure of that. I want you to ask Gen. Crozier as to that. Mr. Emeey. There is a sentence here from Gen. Crozier's state- ment that I think if you will permit me I wiU read it to you. Mr. Nolan. I want to get the page. Mr. Emeey. This is an address that he made this winter. He says here: Some of the conclusLone of the reports are very curious; one of them, for instance, says that the claim of increased earnings for the workman was shown to be unfounded, and that as a matter of fact wages were reduced. This conclusion was worked out by showing that if a man did two and one-half times as much work under the premium system and received only 33J per cent more pay, his pay per unit of work must have been less, which the committee called a decrease of wages, notwithstanding the fact that by this kind of operation, a |3 a day man would earn S4 in the same length of time. Is that the point ? Mr. Thompson. That is the point I made; that he does get more pay. Mr. Nolan. Then, let us find out. If you set the task at eight pairs of shoes, and you consider |8 a day a fair rate for eight pairs of shoes, what would that employee get either under bonus or premium system for the ninth pair of shoes that he made ? Mr. Thompson. I will have to ask again whether that $8 is a day wage. Mr. Nolan. No; you are setting the $8 for this eight pairs of shoes. I am leaving it right up to you now. You set $8 and set eight pairs of shoes which must be made for the $8. What would you give him for this ninth pair ? Mr. Thompson. Was his day wage $6, we will say ? That includes a bonus ? Mr. Nolan. Leave out that question of bonus up to $8. Leave out the conditions that he worked under prior to that time; but after you have given him the job. Mr. Thompson. Yes. Mr. Nolan. And decided that within any given time — ^within a day — that eight pairs of shoes be accomplished, we will say, in eight hours' time, and he got for that work $8. Suppose he happened to produce that eight pairs of shoes in shorter time than eight hours, which was the day's length, and it permitted him to make a ninth pair of shoes. What would he get for that ninth pair of shoes ? Mr. Thompson. If he was on a piecework basis he would get $9: if he was on a bonus basis it would not be &x.ed that way at all. Mr. Nolan. What would he get on a bonus 1 Mr. Thompson. If he made 9 pairs of shoes you would give him $9. His day wage might be $8 before. That would be a very small increase; now, you say 9 pairs of shoes is a good day's work. "If you can make 9 pairs of shoes I will give you $9." You do not METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 63 care anything about anything else. You do not care anything about what he would make if he was working on a dav rate. Mr. SuMNEES. Suppose he makes 10 pairs ol shoes, what would he make? Mr. Thompson. In some types of bonus, he would get the extra dollar, and get $10. In other types of bonus, we feel that the ninth is as much as he ought to make, and after that we do not give him a similar increase. Mr. Nolan. He would not get $10 for that? .Mr. Thompson. Not always. It depends. For instance, on the type of work Mr. Towne was speaking of, he gets the work increased right away; in other types of work you set a task with the human elepaent in view, and the effective pomt in that is that you say a fair task is nine shoes. I am not going to pay that man any more if he makes 10 pairs of shoes; because I do not want him to make 10 pairs. Nine pairs of shoes is enough for him to make. Mr. Nolan. Then your system also stops the opportunity of the individual? Mr. Thompson. It stops him from overdoing. Mr. Nolan. It does stop him from overdoing. Mr. Thompson. In this type of work it does. Mr. Nolan. By penalizing him in that way ? Mr. Thompson. He never does it. Mr. Nolan. I do not see why he should. Mr. Thompson. He does not. Mr. Nolan. If you are going to bring down the pro rata amount per unit. Mr. Thompson. Take it in a shop like that, and the average man is almost identical vdth that man. They do not overrun it, because the employer does not want them to and does not offer them any incentive. . Mr. Nolan. Is that the reason given for Gen. Crozier's 274 per cent with only 33J per cent increase in wages ? Mr. Thompson. He works on a different plan. Where there is an increase with the amount done, which I think varies directly with the amount put in, the idea being that in most of the types of the machine shop work that he has, so much of it is machine work that the extra amount does not tire the man. Mr. Nolan. Now, Mr. Thompson, in all fairness, if you could not illustrate to this committee on a simple proposition of this kind how a bonus or premium system could be applied, how in God Almighty's world could you expect it to be agreeable to the men in the shop ? Mr. Thompson. It is surprising how the men in the shop can figure all kinds of things, as you know, when it comes to the amount you earn. Mr. Nolan. You could not give it to the committee on this simple example. Mr. Thompson. My point was right here that you and Mr. Sum- ners both were starting out on a day work basis, and I could not understand whether you were driving at the day wage or the bonus wage. The bonus plan does not take into account what the man does when he is getting just his day's pay, because the (question is to get the bonus up and not the day's pay. That is the point that I was trying to explain to you. 64 METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. Mr. Keating. As I understand it, you advocate the Taylor system and are installing the Taylor system in your business ? Mr. Thompson. Yes. Mr. Keating. Let me ask you if Gen. Crozier has made an accurate statement of the bonus sJTstem in this quotation from his annual report for the fiscal year ending June 30, 1911, pag e 17: For e^cample, a workman has been doing a piece of work in 190 minutSB. After a painstaking study of the job, and of all the means of saving time, the man is carefully instructed as to these means, and is told that for every minute savedwithm, say, 120 minutes, he will be paid for half a minute at the regular rate, in addition to his regular daily pay; and that it is thought that he can do the work in 72 minutes, for which time the increase over his regular pay will amount to 33J per cent. Is that a fairly accurate statement ? Mr. Thompson. That is a fairly accurate statement of what is termed the "premium method of pay." Mr. Keating. Gen. Crozier described it as the bonus system. Mr. Thompson. Gen. Crozier is not quite correct in calling that the bonus system. It is more technically the premium system. Mr. Keating. And we will not be able to consider Gen. Crozier as a technical witness or an expert witness in considering this system ? He is not to be regarded as such ? Mr. Thompson. I said that he is not generally considered so; those are relative terms and they have not been in use for very long, and they are used synonymously to a limited extent, and used inter- changeably, and I am talking about as a general rule the other term is used as a bonus and this is used as a premium plan. It is really a bonus — I want to qualify what I say. A premium is really a bonus plan. Mr. Keating. I will come to that in a moment. I want to get, first of all, the accuracy of this particular statement by Gen. Crozier. Gen. Crozier says that a worlmian has been doing a piece of work in 190 minutes; that he is then timed, so that those timing him conclude that the work can be done in 120 minutes; and then the worlanan is told that it is thought he should be able to do it in 72 minutes, and if he cuts the time in which the particular task is to be performed from 190 minutes to 72 minutes, his salary will be increased 33J per cent; is that right? Mr. Thompson. Yes. Mr. Keating. And the workman receives as compensation pay for one-half of a minute of time for each minute that he saves under the 120 minutes ? Mr. Thompson. Yes. Mr. Keating. All right. Senator Borah in his report on a bUl like the one we have under consideration, makes this statement concern- ing Mr. Taylor's plan, which is known as the differential rate: If it is discovered that the maximum number of pieces of work which a first-class workman can do in a day is 10, he will receive 35 cents apiece, provided he completes all 10 of them. If, however, he should fail to complete the 10 pieces, even if his task is missed by only 10 minutes, he would get only 25 cents apiece for all of them, thus maldng the workman's wage for the day only $2.50, instead of $3.50, for runniBg behind 10 minutes on his schedule time. This arrangement furnishes him a poweiivu incentive to work at his utmost. Is that a fair statement of the differential rate ? Mr. Thompson. So far as I could follow it, that is a true statement. Mr. Keating. Can you state briefly to the committee the difference between the piece rate and the bonus system ? METHOD OF DIKBCTING WORK OF GOVEBNMENT EMPLOYEES. 65 Mr. Thompson. The ordinary piece rate, you mean ? You do not mean the differential piece rate, or do you ? Mr. Keating. No. Mr. Thompson. The ordiaary piece rate; a man gets so much for a piece, we will say 20 cents per piece, no matter how many he makes. He may get less than a day's wage in making, those pieces or he may get more than a day's wage — that is, there is no limit either way. On the bonus system he is guaranteed a day's wage, no matter how many he makes. He is given, if he makes the standard amount, a bo: .U3 of, say, 33 or 35 or 40 or 50 per cent when he does that standard day's work. If he does below that, he gets the day wage. Mr. Keating. How do you determine the day's wage ? Mr. Thompson. As I said a little while ago, that is determined by the local conditions and, ultimately, from the law of supply and demand. Mr. Keating. Suppose the day's wage was $3 ? Mr. Thompson. Yes. Mr. Keating. What would be your standard wage ? Mr. Thompson. The day's wage would be $3 and the bonus wage or the wage for the standard time — that is probably what you have in mind — might be one-third more than that, or $4. The amount varies. The reliation between the day's wage and the wage plus bonus varies with the kind of work. Mr. Keating. You say that the man would receive $3 without regard to the product he might turn out ? Mr. Thompson. Yes. Mr. Keating. Do you mean to convey to the committee the impression that you have no standard by which you judge the effi- ciency of the workingman ? Mr. Thompson. You judge the efficiency by whether he does the standard amount, which gives him the $4. Mr. Keating. If he fails to earn the standard amount, you regard him as inefficient? Mr. Thompson. Not necessarily; no. Mr. Keating. How far could he fall below the standard before you would consider that he was an undesirable workman ? Mr. Thompson. If he continually fell below the standard set. If he continually failed to earn this bonus, I would say that he was not fitted for that class of work, or else there was some condition wrong with his- machine work. Just as soon as the workman fails to earn this bonus — and that is one point about the bonus system— just as soon as the workman for a few days or a week, fails to earn his full bonus, the conditions are investigated. It is brought right to the attention of the manager; the conditions are investigated to see what the trouble is, whether it is in the man. It is usually the fact that the man is not doing the work in the right way and needs more training, or else that there is some other condition of work that is wrong, or materials: and that is rectified. If he continues to earn below th& bonus paid', he should be transferred to some other Mnd of work. Mr. Keating. How do you determine the amount of work which shall be performed in order to earn the standard wage ? Mr. Thompson. By time study. 36162—16 5 J 66 METHOD OP DIBEOTIlirG WOKK OF GOVEENMENT EMPLOYEES. Mr. Keating. Do you take an ordinary workman as the subject of that study, or do you take one of your fast, skillful workmen ? Mr. Thompson. You take a man who is well fitted for his work — if you take the same type of man aU the time — that is a little different. It makes no difference in your final result whether you take the fast man or the ordinary man, for this reason: That you always have to add a certain percentage, which depends on the class of work, and in which there are certain rules, and so on. You have to add a definite percentage if you are using a first-class man, and you add 1 per cent; if you are using your average, ordinary man, you add another per cent; so that you get the same result, and the result you get must be such as will aplpy to the average man in the shop. In other words, you base it on the average man. Mr. Keating. Then, to get back to the shoes: You take an ordi- nary workman and you put him to the task of making shoes. We are now going on the assumption that the workman manufactures the entire shoe, which we know is not the case, but for the purpose of this illustration. You take an ordinary workman and you time him, and you find that he can make a pair of shoes in an hour; now, what is your standard in that case — ^in order that the workman may secTU-e a standard wage? Mr. Thompson. You time this one workman and find that he can make an ordinary pair of shoes in an hour. The chances are that {rou would fix the standard time at higher than an hour, to allow for ost time that you do not get when you are timing him. Mr. Keating. And you would increase his salary 33J per cent and allow him more time in which to perform the task ? Mr. Thompson. Yes ; than when you are watching him. Mr. Keating. That is the system that you follow 1 Mr. Thompson. Yes. Mr. Keating. Let me understand that clearly. The shoemaker is earning 50 cents an hour in an ordinary shoe factory in that district. You come along with your efficiency system. You take an ordinary shoemaker and you time him and you find that he makes a pair of shoes in an hour. Then you give him more than an hour in which to perform his task, and you give him an increase of 33 J per tient in his wages ? Mr. Thompson. Yes. Mr. Keating. Is there nothing else that you do ? Mr. Thompson. But when you say you time him and find- that it takes an hour to do it, I am assuming that that is the time that is based on the improved methods. As I say, you do notproduce your task and a bonus until your methods are improved. Ttat is, I was answering the question about the six months or two years. You have got to improve your method and get your things standardized before you can take your final time studies to set your task. After you have got your methods improved you have increased usually without any effort on the part of the men, reduced the time, we will say, from a minute and a half down to a minute. Do you get the idea? Mr. Keating. Yes; I see the point. Mr. Thompson. And then on that you add the percentage for delay. Mr. Keating. But increase the salary 33 J per cent. Mr. Thompson. As a general principle; of course, the percentage in some cases — we have increased 50 per cent. METHOD OF DIRECTING WOBK OF GOVEENMENT EMPLOYEES. 67 Mr. Keating. That is a matter to be determined by the employer. Mr. Thompson. No; that is determined by studies and relation between the percentages that have to be given on work of that type. In other words, that is a standard; one which is much more nearly standardized than the piece wage. Mr. Keating. You said in your preliminary statement that one object of your system was to reduce the hours of labor of the work- men. Mr. Thompson. I said that one of the results that we were working toward was that. Mr. Keating. Have j^ou reached it yet ? Mr. Thompson. Yes; in a number of cases. For instance, one shop where we have been doing work cut down its hours last January as the result of scientific management methods. Mr. Keating. Could you give the committee the name of that concern ? Mr. Thompson. Eastern Manufacturing Co., Bangor, Me. Mr. Keating. What hours were they working before they were cut ? Mr. Thompson. Ten hours, which is the standard in that section. Mr. Keating. And they reduced to nine ? Mr. Thompson. They reduced to nine. Mr. Keating. Do you know of any other establishments ? Mr. Thompson. Eaton, Crane & Pike, in Pittsfield, has reduced its hours lately. They have been putting in scientific management. Mr. Keating. Axe there any labor organizations in those estab- lishments ? Mr. Thompson. I do not know as to Eaton, Crane & Pike. There is not in the Eastern Manufacturing Co. at Bangor. Mr. Keating. You do not know whether labor organizations' efforts had anything to do with it or not ? Mr. Thompson. ]Sio; they did not. That is, so far as the Eastern Manufacturing Co. is concerned. It was really the result, not simply of the management work, but the indirect result of the management bringing a service secretary there, who looked after the welfare of the employees, and it was with her cooperation and advice that it was brought down to nine hours. Mr. Keating. As a rule, under the Taylor system, you have just the two scales of wages, the ordinary wage and the standard. Haven't you a series of bonuses ? Mr. Thompson. Sometimes. That depends upon conditions. You have aheady named three types of pay, the differential pay, the piece rate, and the bonus. Mj. Keating. You have a number of rates ? Mr. Thompson. There are a number of different methods set out to different things. The main thing and the thing you are cutting out, if you pass this bill, or report this bill, is that you are cutting out the means of scientific study and investigation, and the means of increasing the output through this scientific investigation. The pay is a very small part. You can have your scientific management on piece work. As I say, it does not work so well, but you can have it it you set your rate scientifically. Mr. London. I want to ask one question, if you are not too tired, Mr. Thompson. Mr. Thompson. All right. 68 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. London. Mr. Emery brought out a moment ago the fact that Gen. Crozier criticized the Committee on Education and Labor in reaching the conclusion that the wages of the workers would be reduced, in spite of the fact that each individual worker would obtain an increase of wages from 13 to $4 a day. Mr. Thompson. That is, his price per piece would be reduced. Mr. London. His price per piece would be reduced ? Mr. Thompson. Yes. Mr. London. But his earnings per day would be increased ? Mf. Thompson. Yes. Mr. London. And it is based also on the theory that he would do two and one-haU times as much work under the premium system. Mr. Thompson. On that particular job. Mr. London. Let us take that as a basis for our reasoning. Each individual worker doe& two and one-half times as much work as he did before. He gets, instead of $3 per day, $4 per day. Mr. Thompson. Yes. Mr. London. He is benefited by obtaining an increase in wages ? Mr. Thompson. Yes. Mr. London. Let us see, then, how it wilt affect all the workers in that branch of the industry. Assume there are 1,000 workers in that particular branch of the industry.- The productivity of each of the workers has increased two and one-half times. That is it, is it not? Mr. Thompson. Yes. Mr. London. It will therefore not be necessary to employ 1,000 workers any more ? Mr. Thompson. No. Mr. London. We will have to divide it by 2 J the 1,000. Mr. Thompson. You wUl if the whole shop is on that basis, which of course is rather an unusual ratio. If the whole shop is on that basis. Mr. London. If the whole shop is on that basis you wiU have to divide 1,000 by 2^? Mr. Thompson. Yes. Mr. London. In other words, we will employ but 400 people instead of a thousand. Mr. Thompson. In that assumed case. Mr. London. And 600 men wiU then find themselves out of em- ployment, competing with 400 men who have retained their jobs. How long will it take before the 400 men will have their wages reduced under the pressure of 600 men who have been separated from their jobs? Mr. Thompson. Now, of course, the point is here that you are using an extreme case. Mr. London. I am reasoning the thing out scientifically. Mr. Thompson. At the same time the principle is the same. As it works, of course, that is the same objection that you can raise to the introduction of machinery. Mr. London. Very well. Mr. Thompson. But there is this difference between the introduc- tion of machinery Mr. London (mterposing) . You wiU pardon me. What I am try- ing to get at is this: what is it that annoys the worker, who is very METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 6:^ often afraid of the word "scientific," and is afraid of new schemes and devices ? Mr. Thompson. Yes. Mr. London. What inspires fear in his mind is that it will affect his opportunity to earn a livelihood; that it may increase the com- petition between the workers; that it may result in the discharge of a certain number of employees; and it seems to me that a scientific expert must approach that question from that standpoint before he will satisfy the workers that they should adopt scientific manage- ment as a method of production. Mr. Thompson. Of course, we can not go into that economic side of it so much. Of course, it is the same general principle as the intro- duction of machinery, but with this difference: That scientiSc ma- chinery is introduced very slowly. It takes a long while to get a shop to introduce new machinery. Mr. London. In other words, it is medicine to be taken in small doses and rarely. Mr. Thompson. That is about the idea, and it does not affect them so much. Mr. Keating. We thank you for your courtesy in appearing before us, Mr. Thompson, if you have nothing further to say. Mr. Thompson. I just want to read one note here from a letter re- ceived from a correspondent. He says: "If the United States is to be cut off from the benefits of this sort of management, aU I can say is God help her when she gets up against Germany in the struggle for existence. Mr. Emery. That conclusion gives peculiar significance to the tes- timony of the next witness. Mr. Noyes is the general superintendent of the German-American Button Co., of Rochester, N. Y. His testimony will be entirely neutral, nevertheless, but he can speak of a big establishment here, because he is one of the 35 shops that was examined by the committee representing the Federal Industrial Commission, and they employ about 1,000 people, who have operated under scientific management, as installed under the suggestion of Mr. Taylor, during a period of perhaps 15 years. STATEMENT OF ME. HENRY T. NOYES, GENERAL SUPERIN- TENDENT OF THE GERMAN-AMERICAN BUTTON CO., ROCHESTER, N. Y. Mr. Notes. Mr. Chairman and gentlemen of the committee, I won't take but a very short amount of your time. It seems to me that the problem before you is whether you wiU approve of scientific management by doing nothiog, or whether you mil condemn it by passing the biU before you. The criticisms that you can apply to any system of management would be many, no matter what it is. The way to judge scientific management, perhaps, is to compare it with others. You can criticize scientific manage- ment, undoubtedly. You can criticize other systems, undoubtedly. I think the big fact does stand out very prominently to those who do have anything to do with it that it is a big step in advance. I do not think there is a manufacfurer who ha,s tried it who will not say that it is a big step in advance. *0 METHOD OF DIKKCTING WORK OP GOVEBNMEKT EMPLOTEES. The question is simply whether you will condenui it or no, I only want to give a few facts regarding it. In the first place, every plant will give you proof and figjuires to show that they are paying higher wages than the 'wages; in that community. That is true. That can not be gainsaid. The employ- ees are earning higher wages than the ordiinary wages in that com- munity. Secondly, they will give you proof to flie effect that they have advanced wages considerably over what they were in the plants bef ©ire they introduced scientific management. Those facts stand out very prominently. There are otiiers, namely,, that the. plants have a tendency to short hours more quickly tham others. I happen to know Mr. Feist, of Cleveland, whom you are t» hear to-morrow, and I know that he works shorter hoars than any shop in the entire clothing industry. I know that we work shorter hours than any other button factory in any other shop ia the country that we know of. Now, then, as I have listened to you to-night, I can See how much confusion naturally arises in discussmg this subject in its details. For instance, there are a great many different methods of payment prae^ ticed in shops. I do not think there is one standard method of practice, even under the Taylor system. Some engineers practice one different method of payment; some another. In fact, you wiU find some engineers that have two or three different kinds. There are different kinds of bonus payments and different kinds of differ- ential pay-rate payments, and it is very hard to compare them. For instance, Mr. Thompson's method is one. Mr. Feist has an entirely different one, and I think Mr. Feist, if he could debate with Mr. Thompson, could give him some arguments as to whether his methods are better than Mr. Thompson's. Mr. Thompson is a Taylor man, and there are Taylor men who will sit up all night and tell him why their methods are better than his. The thing that stands out bigly is that it is a big step forward. I have been connected with the industry some twenty-odd years. We used to set piecework by guesswork. We realize now inaccu- rately it was done. Changed conditions come up to-day. They are not like those which Mr. Nolan mentioned, where things have gone on for years; I believe he said 26 years. On the way we pay people, they all want to be paid on some scien- tific basis. People ask us if they are not on it to be transferred to it. This assumes to deal with it in a scientific and relatively just way. It lays great emphasis on being relatively just, as compared with the others — ^not absolutely but relatively. Those things are true. I think they stand out against any other system in vogue. They are some of the large things that are done. It is scientific compared with the old methods unquestionably. The basis of it largely is in time study, if you take it in a big sense; study of all the facts that deal with tne time of individuals. Your action in condemning it at this time would come at, I believe, an unfor- tunate period, because I think scientific management has been going through preliminary stages. It is becoming better known to-day than ever before, and I think it is going to make progress from one other standpoint. I think that industry in the past, com- pared with what scientific management does to-day, looked at a METHOD OF DIBEOTING WORK OF GOVERNMENT EMPLOYEES. 71 laboring man as a machine and not as a human being. I claim to you that the plants which practice scientific management — that is, the plants as I know them — are dealing with men as human beings up to a far greater extent than they did 10 or even 5 yearp ago before we knew scientific management. My own particular business — we have no outside stockholders at all. The people who own the business are all at work every day in the business, and we try to deal with all of them as best we are able. We have niore stockholders in the factory than we have in the office, and from time to time we are increasing our stockholders, and it is a plant owned by working people rather than outside capital. Here is another thing that is very confusing to you good people : When I think of accomplishments through time study, I do not think we get anything through speeding up or putting people to extra efforts. That is not it. We really get results through different means of improving conditions and the hke. The results that are obtained are not from speeding up. Very truly they are not. It is a rare case where that ever applies. That is not where we get the results. It is from a study of the conditions, improving them, and the like. So that wherever you introduce it, it throws a tremendous responsibility on the management that it never had before. It is a check on the management. One of the most important things you have to do is to keep your machines in good condition and repair. That is abso- lutely essential, and that fact alone gives you increased output. Where the operators understand it and know the conditions under which they are working, that serves as a check on you to keep con- ditions on that basis. It is a check on getting your supplies where they can get them. The results are not obtained by speeding up, or from this extra effort. I will also claim this for Mr. Feist. I would hke to speak of Mr. Feist's plant, which I know so well. I wish you might visit it. I have visited it a good many times. I take a great deal of pride in our workmen and in their cooperation. I have never found a plant in which you have more cooperation than in Mr. Feist's. A man could not go into that plant of Mr. Feist's and spend half a day without reahzing that. I think that is also true of our own organization. I think that our efforts in scientific management have brought that about. I think that is the tendency. Here is another thing that scientific management is deling. The plants that are operated under scientific management can not only furnish you the facts regarding higher wages, shorter hours, and the like, but they can prove to you that they hold their employees better than the plants that are not so operated. That is ah astonishing fact, but it is true. I do not know of a plant that holds its employees better than Mr. Feist's. I have corresponded with a great many to find out what the average percentage of turnover is. I claim to you that there is not one in Rochester that holds its employees better than we do, and show less percentage of turnover, r stated that I wrote to a great many — I mean that I wrote to seven or eight that are in existence in that city, the larger ones, with whom we have compared figures. 72 METHO© OF'DIEECTING WORK OF GOVEKNMElifT EMPLOYEES. Only one or two little points on the question of accidents. It un- questionably reduces accidents. We have figures to prove it. Our 'figures are so astounding regarding accidents — vre once met a number M accident insurance men ito New York City and gave them our figures, and they said that they were the most astounding that they imeyf of, and they could hardly believe us. We voluntarily assume liability in case of accident to anj one of our employees, and we never agk him to sign anything like a liability company would have him do. We. keep very complete records of our accidents, far more carefufly than the law requires and we did so before the law went into effect, and the amount of lost time over a period of two years, as I remember the figures, was so small that it did not cost us out of 1,000 employees as much as $100. I mean, under the law as it now stands, it would not have cost a hundred dollars. We did not wait for the enactment of the law, however. We do more than the law calls for. So far as accident cases are concerned, I am sure accidents have decreased. I can give you some very interesting figures regarding health, and I would hke to recite only a little bit of the circumstances under which we gathered these figures. Some six years ago we told our employees that we had a nurse and doctor, and that they were there to be of service to them, and if they wished to have their health examined and suggestions made by the doctor, we would be very glad to have them do so. We give sonje little health lectures for them to attend, and we paid their wages at the time they were off from their work attending these lectures, and then it was stated that they could make appointments with the doctor to be examined. It was entirely voluntary. Seventy-seven per cent of our employees at that time were examined. We stopped with that at that time, but two years later we started it again, and we had two doctors at the time. We found that one doctor was much more strict than the other, and we found that our people hked that and wanted to go to him, and that he took time to examine them and give them advice. We had the astounding experience of having all of our employees submit themselves to examination without objection, bar- ring only five. Those five people we did talk to, and I was always one of the first. We did talk to this five, and they were examined. The figures I want to give you are these, and they are very, very gratifying to me. When we first examined our eroployees we found 51 people in our employment who were seriously affected as to health, that is, their condition was serious. Mr. London. Out of a total of what? Mr. Notes. 900 or 1,000. What we call our risks. Fortunately, we knew somewhere where a man was afflicted with a severe hernia, we shifted his work. We have had these people under examination. We suggested that they go down occasionally to see the nurse and the doctor, and visits to our nurse and doctor are very, very frequent, and if I would go into details I think I would really astonish you. They can go at any time to see them and ask them for advice. It was more than 51 when we started, and we had those 51 ex- amined during the month of January, and we were able, checking up against the records, three, four, five, and six years prior, to state that we had shown an improvement in the health of every one of the 51 except one. There was a marked improvement in these men who were the most seriously affected. That is a matter of record. You METHOD, OF DIRECIING WOB,K QP GOVEBNJMENT .EMPLOYEES. 73 can see their health examinations. The doctors can go over their records and conware them. We (have less lost time than we eyer have had in the business, and we have other evidence ;to give you. I;am,only giving you part of it. We became interested in the science of mana-gement 15 years ago, and I have some figures to give you as to the increased rates of pay in our plant as against 15 years ago. Our rates of pay for girls have increased from 135 to 140 per cent. For the men in our employ, their wages have increased from 80 to 90 per cent. These are ordy some general figures. I do feel this, that if you good people have the chance to visit these plants — I know of course that it is complicated. I' can see that when you discuss the details of it you can criticize any system without question. The thing that stands out in my mind is that it is such a big advance over what existed formerly in industry. I think also that it is very much more humane than it has been. We try to establish norm.al rates for the departm.ent that are relatively just; one as against the other. We have made for years a study of that. We took into account the prevaUing wages in the community. We took into account the wages paid in our industry, wherever it was located, and any branches of it. We won t pay less than our competitors pay as a basis for normal wages. We tried then to take into account the tim.e of learning, the risk that is involved, what is going to happen in old age. Does it lead to opportunities and the hke ? We tried, where a man said that his job was a hazard- uous one, we thought he ought to earn more, and we took into account all of these factors, and after we have our scales made up, we have the plus and minuses for the different things. But the fact stands out that our people do earn more than the operators in any other button industry, and relatively more than the community. I can say one other fact, and that is that I think our people prefer to come with us. It is a reputation that we have established, and it is a reputation which we have the good fortune to share only with one other concern in Kochester. I think people prefer to come to us as against others. The question came up as to Prof. Hoxie's opinion in this matter, and I happened to have an interview with Prof. Hoxie, or at least I was present at an address he have in Rochester some six weeks ago. He delivered an address there and set forth the objections to and the reasons for scientific management. He tried to be just and im- personal and set forth the claims and arguments pro and con. After he delivered his address someone asked him what ne thought about it all; what was going to happen, what should we try to do. He asked if they^ wanted his personal opinion in the matter, and he said: "Personally, I can not conceive that the American public will give up scientific management. The American public is interested in anytning that promises increased efficiency." He expressed it as if there was not a doubt about it as to its revival ultimately. I think if you people really were in touch with it and visited this Elant, I think you would feel that impression also. You can spend ours and days criticizing this thing or another thing or any other system. I have simply tried to present it to you in a general way. I do not think I have any more to say. 74 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. SuMNERS. I just wanted to suggest. As I understand this bill and the witness's statement; the witness's statement, as I under- stand it, does not deal with the objectionable features of the bill. As I understand this bill, it would not disturb any of the things which you spoke about. This bUI deals with a system of fixing tune by the stop watch, and does not disturb your doing any of the things which you have discussed as having been done justly. Mr. Notes. This bill woidd seriously affect it, because it puts an end to stop-watch work in connection Avith government^ — ^that is fundamental. Mr. SuMNERS. That is the point that I myself, as a member of the committee, woujd hke you to address yourself on. Mr. Notes. It is fundamental to development under scientific management. You can not get the data and the facts without it. Mr. SuMNERS. Who could not you have a doctor and a nurse and shift the man who has got hernia to some other job and all that sort of thing Avithout the stop-watch proposition? You wiU pardon me. I do not mean to interrupt you or confuse, but I earnestly want to find out. Mr. Notes. The doctor and the nurse came in only a few years ago, but we started work on the scientifite management 15 years ago. Tfiiat is only a by-product, so to speak. Mr. SuMNERS. But my point is, Why can't you deal with the human animal — what has the stop watch got to do with dealing with the human animal and getting doctors and nurses and all that sort of thing ? The stop watch is what we have been complaining about, and I do not think you have touched upon it. Mr. Notes. The bulk of achievements under scientific management are based on time study in a broad sense. Mr. SuMNERS. That is what we want to know about. Mr. Notes. That is the fundamental basis of it, time study in a broad sense. If you take away your stop-watch and your time- measuring systems, you are doing away with the basis on which things are accompHshed. Mr. SxJMNERS. Why? Mr. Notes. Because we can not get at the facts scientifically. We can not get the data without it. Mr. Smith. Do you have to have the stop watch to increase the wages ? Mr. Notes. No, sir; but we could not afford to unless we could get results that would justify us in doing it; unless we could get increases sufficient to make that profitable. Mr. Smith. You have increased wages 140 per cent in 15 years. Mr. Notes. That is the raise of wages for the girls. Mr. Smith. The carpenters got an increase in wages in Chicago last fall, and the carpenters struck because they were only getting 40 cents an hour, and their wages must have been increased a great deal more than that. Mr. Notes. I do not conceive that we could have existed imder the hard competition which we have vmless we had been able to effect economies through scientific management. It is not even a conceiva- ble possibility. Mr. Smith. There are so many of these instances that you have related that do not depend on the stop watches. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 75 Mr. Notes. How could I afford to advance wages indefinitely in the competitive fiel,d ? We make largely vegetable ivory buttons. The total production, of ivory vegetable buttons is less than $5,000,000, and there are 23 factories making them and 20 of them have a capital of $20,000 and upwards, and the hardest competition which we had previous to the war was with German and Austrian factories. There are 23 concerns fighting for it. We can not do those things unless we can get economies through science and management. Mr. Smith. I want to compliment you on the mterost you take in your workmen. Mr. Notes. We could not have done it without the time-measuring system. You get my jjoint, Mr. Sumners ? Mr. Sumners. Yes, sir; I get your point. Mr. Smith. You have a plant run by steam, and you have an en- gineer and you have bookkeepers. Do you use your stop watch on them ? Mr. Notes. I think in the end we would; yes, sir. Mr. Smith. Do you use it on your teamsters ? Mr. Notes. I think we ought to use them everywhere. Mr. Smith. Does it apply to agriculture ? Mr. Notes. I will hold up my iands. I am just talking about oiu^elves, trying to tell our httle story as best I can. Mr. Smith. How about the total number of employees now and 15 years ago ? Mr. Notes. About the same; about 1,000. There is not much difference. Mr. London. I understood you to say that the adoption of the stop watch does not necessarily involve speeding up. Mr. Notes. What I meant to say was this, that the results accom- plished through scientific management are not to any degree at all due to speeding up.' That is what I want to make clear. -It is not even thought of in that connection. Mr. London. And the only object of the stop watch Mr. Notes (interposing). Is to get the data. Mr. London. And the number of operations necessary for the per- formance of a particular piece of work ? Mr. Notes. And all the factors pertaining thereto, condition of materials and condition of machines. Mr. London. Is the work subdivided into various branches and sections ? Mr. Notes. In our business ? Mr. London. Yes. Mr. Notes. Yes, sir. Mr. London. How many processes are necessary to turn out a button ? Mr. Notes. It depends on the kind of button you make. To take the most complicated one I know of — ^we handle a raw material that goes into a green state, and we have to dry it, and it takes about 14 months on an average and involves 65 or 70 operations. Mr. London. Are your 1,000 employees divided into 65 groups, or approximately that number? Mr. Notes. A good many individuals do more than one operation. Mr. London. But most of them ? 76 METHOD OF DEEECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. NoYES. We are trying, to train our people to do more than one and broaden them out and give thetn better opportunities. Mr. London. But, as a rule it is confined to one operation in most factories? Mr. NoYES. Yes, to a certain extent, in general. It was true before we started scientific management, and it is true to-day. Mr. London. Would it be unfair to ask you what the present wages of the women workers are ? Mr. NoYES. I can not give you the actual figures, because I do not know them at this moment. I have only the figure of increased percentage. Mr. London. If the original wage was very small Mr. NoYES. They were the prevaiUng wages under the conditions in the industry at the time. Mr. London. And it is a competitive industry ? Mr. No YES. Extremely so. Mr. London. So that, in determining wages, you have to be guided by the law of competition ? Mr. NoYES. I can show you how extremely so that is. When we appeared before the Ways and Means Committee, Price, Waterhouse & Co. examined the books in 15 of the 23 companies, and certified that the average earnings of the 15 companies had been less over a period of three years — had been less than 4 per cent. Mr. London. Exclusive of the compensation allowed to them as salaries, I suppose. Mr. NoYES. Including that — no; I suppose that was the profits of the industry. But the salaries are very low. They are all low, in- cluding my own. Mr-. Nolan. What were the hours of work in your establishment before you had scientific management ? Mr. NoYES. Fifty-nine or sixty hours. Mr. Nolan. What are they to-day ? Mr. No YES. Actual working hours 51 J. Mr. Nolan. How is it divided in the week ? Mr. NoYES. I can not teU you just now. We have changed several times. We stop at noon in the factory. Mr. Nolan. Were you present in your establishment when Mr. Hoxie and Mr. Valentine and Mr. Frye visited it ? Mr. NoYES. I was there when Mr. Hoxie visited it. Mr. Nolan. Did Mr. Valentine and Mr. Frye visit it? Mr. NoYES. Mr. Valentine did, but Mr. Frye did not. Mr. Nolan. How long was he employed in looking at your estab- lishment ? Mr. NoYES. Mr. Hoxie was with us two and one-half days, as I recollect it. Mr. Nolan. Do you think that he had a fair opportunity to observe the efiiciency system in your establishment in that time ? Mr. NoYES. I think Mr. Hoxie a very shrewd observer in many ways. It is awfully hard to tell what a man observes when he goes through an establishment. Mr. Nolan. Was he accompanied by any members of the firm or any of the officials ? Mr. NoYBS. He was with me part of the time and three or four of our people a part of the time, and he went by himself at one time METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. 77 and interviewed numbers of the people when I was not with him, or ajiyone else connected with thp firm. He asked that privilege par- ticularly. Mr. Nolan. He had a pretty good opportunity to investigate ? Mr. NoYEs. Perfectly, sir. Mr. Nolan. You think he made a fair examination of your estab- lishment so far as the scientific management is concerned ? Mr. Notes. It is a question of how much a man gets from such an examination. I can not tell you. I do not know what he got. Mr. Nolan. He asked for the cooperation of the concern ? Mr. NoYES. He asked us to help him and give him facts, and we tried to do what we could. Mr. Nolan. And you gave it to himi Mr. NoYES. To the limit of our ability. Mr. Nolan. So when he went into your establishment he did not ignore the officials of the establishment, but took into consideration the concern itself and asked their cooperation, and went into it as extensively as he could during the time he was employed ? Mr. Noyes. I should say. so. He asked the privilege of going into the departments alone and interviewing the employees, and he did that and interviewed foremen and others in there. Mr. Nolan. You have referred to a question I put to Mr. Thomp- son a while ago regarding the stove manufacturers. You do not know anything about the stove manufacturers, do you ? Mr. NoYES. Only on your say so. Mr. Nolan. You do not know that they have absolutely revolu- tionized the stove business in the stove foundries in recent years ? Mr. Noyes. Absolutely nothing. I know absolutely nothing about it. Mr. Nolan. So that you do not know that the introduction of labor-saving machinery and new methods of molding are just as com- plicated and have to have the same degree of ingenmty appMed to the setting of piices on the new stoves as they would on the old ? Mr. NoYES. I know nothing about it. I just simply took your say so on it. You said it had lasted for 26 years, and that is all that I knew. Mr. Nolan. I said that the system of setting prices had lasted 26 years, but not that the business had stood still for 26 years. They have a very efficient organization and good, skillful line of men employed to get the best up-to-date knowledge and have the coop- eration of their men. I just wanted to let you know that there was such a condition. Mr. Noyes. I should not have said what I did without more knowledge. Mr. Nolan. Are you employing time-study men continually in your plant ? Mr. Noyes. Yes, sir. Mr. Nolan. All of the time ? Mr. Noyes. Yes, sir. Mr. Nolan. And have them there year in and year out? Mr. Noyes. Yes, sir. Mr. Nolan. What percentage of the employees in your establish- ment are women ? Mr. Noyes. About 55 or 60 per cent. 78 METHOD OF DIRECTING WOBK OE GOVEBKMENT EMPLOYEES. Mr. Nolan. Could you give us an idea of what the average earn- ings of the women are per week there now ? Mr. Notes. I would not want to speak offhand. I can certainly give you the data. I have not it clearly enough in mmd at this time, but I can do so later on. ' Mr. Nolan. Would it be $8, $9, or $10 per week? Mr. Notes. I would not want to quote the figures unless i quoted them correctly. . i , Mr. Emekt. I know it is asking a great deal of indulgence to hear another witness at this late hour, but Mr. Dunlap is under ahnost the necessity of leaving here, and he will be very brief. He is the editor of the Engineering Magazine, perhaps the best known publi- cation of its class in the United States and perhaps m the world. STATEMENT OF ME. JOHN DUNIAP, EDITOE OF THE ENGINEEEING MAGAZINE. Mr. Dtjnlap. This is so essentially a human question, and it is so perfectly evident that every member of this committee is here with the determination that the committee means to stand by the interests of the working people, as you should that I think perhaps my per- sonal experience may tend to indicate the meaning of what I say under oath. I have been a newspaper man all of my life, and as a young news- paper reporter I was so absolutely outraged — ^by the way, out in Pittsburgh — on the Baltimore & Ohio Railroad in the car strike of 1877 that I became a firm believer in labor unions. I have been that from that day to this, and as proof of that in 1883 I joined the Knights of Labor. I met Mr. Powderly down in Seecretary Wilson's office about three weeks ago, and he reminded me of that, and he told me that the number of my lodge was 1648. Now, I not only believe in labor unions and believe in the orgaiii- zation of the working people, because I know if they did not do it they would be enslaved. ' " 1 know that labor unions and the organisa- tions of labor are not in the least inconsistent with scientific ri'aji- agement, as it is popularly called, and in that regard I want to say to you gentlemen that I have here a brief published by Mr. Louis D. Brandeis, who has been appointed to the Suprerne Court, who dis- tinguished himself as the voluntary attorney to the arbitrator for labor unions, and in this brief he gives the most unqualified testi- mony to the effect that there is no inconsistency between the prosper organization of labor and the introduction of these scientific methods of management. Now, because I am interested in the labor question, and because of my studies all of my life of economic questions, when I started the Engineering Magazine just 25 years ago the 1st of April' I made up my mind that these questions of differences between laSor and capit^ were the fundamental questions in this coimtry, and that that should be a central feature in the editorial conduct of the paper. To illustrate that, in the first paper published in 1891, 1 had a paper by Edward Atkinson on the mechanical display at the World's li^ir of 1893, and I engaged that paper from Mr. Atkinson and had him write it because I wanted him to point out that the true secret of cheap production was machinery; that the difference between the METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. 79 civilization ia which we live to-day and the civilization of the Greeks and .the Romans consisted simply in the utilization of mechanical power, and that what manufacturers and workingmen and every- body else needed to wake up and see was that the secret of all cheap production was in the use of machinery, the utilization of mechanical power. On through 1891, 1892, and 1893 I had all kinds of economic articles on labor strikes, particularly in the coal mines, and in 1896 the subject took definite form in my mind. I published a series of papers called "Modem Machine Shop Economics." The first paper was the loca- tion of the shops: Shall it be in the city or the country — in the city where you have at hand hundreds of laborers to call on, or in the country where you can control your own environment — the design of the shop, the mechanical equipment of the shops, modem machine tools as an economic proposition, and the relation of employer and eroployee. Those papers I announced in a little prospectus which I distributed very wid!ely among manufacturers, and that brought me so many subscribers and aroused such interest throughout the whole country that I saw that I had struck a rich lead, and from that time to this I have been publishing the literature of what is now called scientific management. The man who wrote that original series of papers for me was a man named Horace L. Arnold, who had spent 40 years in machine shops, and he was a poet, a man of wonderful gifts as a writer. He began by coming into my ofiice one day and he said, "Dunlap, I have just seen the most remarkable thing that ever happened to me in all my 40 years' experience. I have been over to the Baldwin Locomotive Works and spent three days with the superihtendeht there, and do you know that that fellow is absolutely destroying machinery ? ' ' He said, ' ' I have been taught all my life that the thing for a mechanic to do, when they bought a very expensive piece of machinery, was to nurse it and take care of it," and I said, "That is absolutely true, because I was over in the Portsmouth shop yards in England last year and I saw block-making machinery that had been in there for 109 years, and they were still using that old machin- ery and I joked with them about being able to make twice as many blocks out of new machinery, and they laughed at me." Ha says, ' ' Over at the Baldwin shops they will buy the very latest piece of machinery they can get to put up, and instead of nursing it they will run it on eight-hour shifts from the time it is put in until it is worn out, and then they will huj something better." I said, ' ' What is the difference between the machine and the product ? ' ' He said, "That is what I am here to tell you. That is the most remark- able thing I have ever seen." He said, "That is the reason these people are able to sell locomotives all over the world in competi- tion with the world, because they use the most wonderful methods." r said, "You write a paper on the destructive use of machine tools," and that paper was published in 1894 or 1895. That is the way the literature of this modern science — and it is a science now — that is the way it started. I am the fellow that pub- lished it. I am the man that published the first book that was ever published on the subject of cost keeping, and Arnold wrote it. He traveled all around through these Eastern factories inducing men to 80 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. give information about how they cut their costs. I had a long series of papers, following this machine-shop series, on cost cutting, and that created a sensation. Arnold said, "We ought to make a book," and I said, "I have never pubhshed a book;! do not care about pubHshing books." He said, "We can make money out of it," and we published the book, and we asked $7.50, and the book has been selling ever since. Arnold made a lot of money out of it, and I did too, and that was the first book pubhshed on cost keeping. As soon as that book sold enough to show that it paid, Arnold came to me and said, "We want a book on The Factory Manager; that wants to be the title, and we want to teach the factory manager what modern science and common sense is in the management of a fac- tory." I said, "Go ahead; the cost keeping is all right." So we pubhshed that book, and both of those books are still selling. They are the first books on that science that were published. We published those two books, and, as I say, they were incidental to the magazine. I never cared anything about pubhshing books, and my managing editor came to me one day and he said, "These articles that we are pubhshing are so valuable that we can make books out of all of them, and we ought to do it." I said, "I do not care anything about the book-publishing business." I said, "Brock- away, the business manager, is a good salesman, and can write good circulars, and we wUl apply some scientific management. I will give you a bonus. You undertake to edit the books after they appear in the magazine, and Brockaway will undertake to seU the books, and I won't be bothered except by putting up the money, and I will give you a bonus," and we agreed on a bonus of 12J cents on the price of the book, and they divided it, and that is the way the Hbrary or indus- trial management was started, and I am the pubhsher of it. Those two boys made 1 1,400 a piece last year out of the book business. That is what we imderstand in our office to be a bonus. To get down to practical things, I think I can answer this question about the 8 pairs of shoes and $8 a day, and the ninth pair of shoes, and I have been hungry to get a chance to do it. Eight pairs of shoes per diem is the standard wage, and he gets $8. If he produces 9 pairs, you want him to get $9, don't you? Mr. SuMNERs. I did not want him to get anything; I want to find out what he does get. I was only trying to get information. Mr. DuNLAP. IJnder the piece-rate system, which is the dfiviiig system, which is the thing that tempts men to overwork themselves, he would get the $9, but under the bonus system what does he get if he is dealt with fairly ? We will agree that the standard rate, the fair day's wage, is $8 for eight pairs of shoes. The concern has adopted modern, up-to-date, scientific methods, and it has employed experts to come in and study how to instruct the producers how lio produce more shoes. It has improved its machinery. It has studied methods of how to supply the material to machines. In other words, it has put intelligence into the work and put capital into the work and put consideration into the brains of the operator, and under that system he would get a bonus of one-third or one-half, according to what was fair, according to the common sense and foresight of the employer. In other words, the bonus would be divided. The increased pro- duction would come as a reward to the worker for using his intelli- METHOD OF DIRECTING WOKK OF GOVEENMENT EMPLOYEES. 81 • gence and his skill and to the employer for introducing intelligent methods. In other words, the division of the bonus is a question to be equitably decided between the workers in the factory and the em- ployer. So it is with Mr. London's living wage. Mr. Nolan. What would the operative get for that ninth pair of shoes ? Mr. DuNLAP. He ought to get at least a third. I would rather he would get one-half. Mr. Nolan. How much would he get, S8.50 ? Mr. Dunlap. In other words — yes, because he could not afford to invest the money in improved machinery and improved methods and employ helpers to bring materials to the machines, unless he got the reward. Mr. SuMNERs. That shoe proposition 1 claim the right with refer- ence to that. Here is the question in my mind. As I understand, the eight pairs of shoes per day production is not the production of a man of average producing capacity under the old system would pro- duce, but the eight pairs of shoes production is the production ofthe average man under the new system, and I recognize that tM man who employs other men to estabUsh scientific methods is entitled to some and a proper return upon his enterprise and expenditure of money. Having put in better machinery, he is entitled to something. Now, then, he has gotten his reward in the eight pairs of shoes pror duction, which is the production of the average man after scientific methods have been installed. That is, so far as the general reorgani- zation of the shop, aside from the speeding up of the employee, is concerned. Now, then, under the stop watch, if the employee speeds up under the stimulus of the stop watch, aside now from any additional pro- ducing power caused by improved general arrangements in the office, why should not he get a doUar for his speeding up ? Mr. Dunlap. In other words, the intelligent employer wants to pay out all the money and employ the experts to teach him how to do" it and provide him with improved machinery and somebody to put the materials in his way; and then induce him to overwork him- self and pay him a dollar for doing it ? You want to go back to the old piece-rate system. Mr. SuMNERS. Wait a minute. Then, if it is not good for him to speed up, why not penalize him for that? Mr. Dunlap. We have had a good deal of technical information here from Mr. Towne and Mr. Thompson, and I do not pretend to be a technical man. Mr. SuMNERS. I withdraw that inquiry. Mr. Dunlap. I do not intend to enter into any debate about the technical details of this thing. What I do mean to say right here to Jrou gentlemen in the interests of labor and in the interests of this abor committee and in the interests of American industry is just this : That these systems represent nothing on earth but common sense and fair dealing and they have been introduced in thousands of the fore- most industrial estabhshments in the United States. I know per- sonally, from Jiaving had an office in London for 12 years, that they have been extensively introduced,, so far as possible, throughout London where the labor unions woidd let them. I know that they 36162—16 6 82 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. have been introduced in the gun factories of Germany. I had an office in Berlin for two years and I know that they were buying American machinery and employing American engineers to teach them how to introduce these systems. I know that Japan is writmg to my office and ordering aU of my publications. I know that this coimtry has got to go up against the competition of England and Germany and Japan as her chief competitors. Mr. Nolan. Getting back to the question of common sense and fair dealing. How do you reconcile this method of payment on the shoe question with common sense and fair dealing, when a scientific eiigineer and an efficiency engineer comes into an establishment and sets eight pairs of shoes as a lair day's work for $8, and then on the part of the operative he produces the nintji, that he should not get' the same amount per pair for the ninth that he got for the eighth? If the employer was willing to pay him |1 for the first eight, why should he take 66§ per cent or 50 per cent of that dollar off? Mr. DuNLAP. Now, we are right up against the problem. I want to get that into your mind just as clearly as it is m my own. This extra jJair of shoes is produced as the result of scientific management, of the study of the methods of production, of the improvement of machine^, of employing instructors to teach the men how to do their work. What possible inducement would there be to the employer to give all of this away ? Mr, Nolan. He is satisfied to pay $1 per pair for eight pairs of shoes. Mr. Dunlap. He is not satisfied if he is an intelligent manufacturer ? Mr. Nolan. What I want to get is a statement from you as to how you can apply the question of common sense and fairness to a propo- sition of that kind where the manufacturer sets the task through this efficiency system as eight pairs of shoes for $8 and gets all of the benefit of that, and is willing to pay $1 per pair for the eight pairs of shoes^ — ^why he should take 50 or 66§ per cent of that price from the man if he makes the ninth pair of shoes ? Mr. Dunlap. The difference between you and me is that you are taking Mr. Thompson's bonus as the foundation. Mr. Nolan. I am taking jour own statement. Mr. Dunlap. I am speakmg of a fair day's wage. Mr. Nolan. Which is $8 ? Mr. Dunlap. Yes, sir; which is $8, and the standard output is eight pairs of shoes. :Mr. Nolan. The standard output is eight pairs of shoes ? Mr. Dunlap. Yes; at the day-wage base. If, through scientific management and scientific instruction and improved machinery and putting the helpers in there, there is an increase of a pair, the employer has to oe rewarded, has he not ? Mr. Nolan. He feels satisfied with eight pairs of shoes a day for $8. Mr. Dunlap. He is not satisfied, and he ought not to be satisfied. Mr. Nolan. But if he is not satisfied, and the scientific management people tell us Mr. Dunlap (interposing). That is under Mr. Thompson's system, and it constitutes a bonus. Mr. Nolan. There is no system under scientific management experts. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 83 Mr. SuMNERs. Under the old system, before you established scientific methods, you were paying the shoemaker $8 to make seven pairs of shoes. I am giving you a hypothetical case. Scientific methods are installed, and the average shoemaker makes for |8 eight pairs of shoes. That is clear, is it not ? Mr. DuNLAP. Yes, sir. Mr. SuMNERS. Now, then, the man who has installed scientific methods has been rewarded by one additional pair of shoes as his compensation for installing scientific methods. He made seven under the old system and paid $8 for it. Now, under the scientific manage- ment, the average man makes eight pairs of shoes and gets $8. Now, he speeds up and makes the ninth pair of shoes. That ought to be clear. Why should not he get a dollar for that ? Mr. DuNLAP. Wait a minute. According to my system of reason- ing, an intelligent manufacturer would not want him to speed, and according to my understanding of the bonus, the standard day wage would be the basis that would be fixed, and finally, the additional increased production would come as the result of cooperation between the enaployer and the employee. Mr. SxJMNERs. Now, the employp got his dividend out of the cooperation in the one pair of shoes which raised the production from seven to eight. Mr. DuNLAP. But you are always getting in Mr. Thompson's bonus plan, but you can not fool me into taking his proposition and making it fit my own. I am talking about the standard wage and the bonus on top of it. Mr. SuMNERS. I was struck by what that man said to you when he went over there to the Baldwin Locomotive Works and told you that they were working this machinery to the highest, producing capacity, and when they got through with it they were putting it into scrap, and I was wondering whether or not there is not running through the minds' of some managers of factories less humane than the gentleman here from Rochester, the same notion with reference to the human machine. Mr. DuNLAP. Delighted to have you bring that up. Mr. SuMNERS. I come from an agricultural section, and I know very little of what you are talking about. Mr. DuNLAP. I think I can explain that, and I think I can also explain to the members of this committee the exact basis of all the feeling against this science, and that was Fred Taylor's demonstration in pig iron. I think, and I have always thought, from the time that Fred 'Taylor gave that demonstration of what it was possible to do with a body of pig-iron men in pure physical labor with a stop watch, was what scared working men to death. What Fred Taylor did there was to cut out the fellows that were ruptured; to cut out the fellows that were sick and weakly. He picked a bunch of fellows who were athletes, and he trained them just like you were training a baseball team or a football team, and he had just exactly what he boasted. He had the finest picked body of men that ever handled pig iron, and he made an enormous increase in the amount of pig iron that was handled, and he did not give the men anything like the additional wage that he should have given them. But Taylor was an idealist. Taylor was one of the hardest men to get along witK, Mr. Keating. Are you not a little severe pn idealists ? 84 METHOD OF DIRECTING WORK 0¥ GOVERNMENT EMPLOYEES. Mr. DuNLAP. Wait a minute. Taylor wanted to demonstrate to the last minute any idea that he ever had in his mind. He wanted to prove that he could greatly increase a man's working capacity, but he took the method of trainmg a gang of experts. Wnat he did was just exactly like a set of men pickmg a football team. He made them win, but in winning he gave a wholly false impression of what scientific management is. What you gentlemen need to understand is that in all industry, throughout all its ramifications and branches, the time has gone by when physical labor, and the chance to speed up and exhaust yourself physically, is a large consideration. In other words, the mind and the skill are the things that count in modern industry, and the thing that this scientific management does, as you wUl get abundant testimony in that brief of Louis Brandeis — what it does is to instruct people to advance ordinary workmen; in tutoring workmen to become instruc- tors of other workmen and gradually rise to positions of superintend- ents. Hundreds of cases can be cited of uneducated men that have risen to the ranks of superintendents through this system. In other words, the whole theory and purpose of this modern science is to edu- cate people how to do work; to ►find out the simplest methods by which we are to do work. Ml'. Nolan. You tell us, and you cite particular instances, of where you have been a pioneer, particularly in scientific shop-management efficiency. Mr. EixTNLAP. Not that; in tjie publication. Mr. Nolan. In disseminating knowledge which would give the em- ployers, we will say, in the machine-shop industry of this country, the engineering end of mechanical trades, an opportunity of studying costs and applying common-sense methods in the instruction of their establishment, installing machinery, etc. Mr. Dunlap. Yes. Mr. Nolan. Is not this where the whole trouble comes : The differ- ence between applying common-sense methods of efficiency and. the methods that have been applied by Mr. Taylor through the stop- watch and time-movement system ? Mr. Dunlap. I do not agree with you. Mr. Taylor was the chief creator of this science — that is to say, he did more to demonstrate its possibilities than any other man that ever lived; but, as I say, he was an ideahst, and he carried many things to extremes. Mr. Nolan. That is just the point I wanted to bring out. Mr. Keating. Is it possible under this system of yours to carry things to extremes ? Mr. Dunlap. It is not possible unless it is in the hands of a brute. Mr. Keating. But it is possible in the hands of an employer or a superintendent Avho has not this consideration for the welfare of his men to apply this thumbscrew — this speeding-up process — ^until you exhaust the human machine, as these men in the Baldwin Locomotive Works exhausted their machinery, and after you exhaust the human machine to throw it into tlie junk heap ? Mr. Dunlap. There is not any engineer alive to-day that has any standing in any society that would be guilty of recommending such a thing. No employer can induce any reputable engineer to recom- mend any such thing. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 85 Mr. KJEATiNG. How about Mr. Taylor? He says this system at Bethlehem was such that only one out of five Mr. DuNLAP (interposing). I had two boys educated at Yale. Mr. Keating. Just a moment. Mr. DuNLAP. Get down to brass tacks. That is right. Mr. Keating. He is the founder of your science. Let us see what he did. I quote from Mr. Taylor's book:. When the writer left the steel works, the Bethlehem pieceworkers were the finest body of picked laborers that he had ever seen together. They were practically all first-class men, because in each case the task which they were called upon to perform was such that only a first-class man could do it. The tasks were all purposely made so severe that not more than one out of five laborers (perhaps even a smaller percentage than this) could keep up. Mr. Dxjnlap. That is exactly what I told you. That is the most unfortunate thing that Fred Taylor ever did. Mr. Keating, it is the truth, is it not? Mr. DuNLAP. It is the truth in that case, but you gentlemen, as Members of Congress and members of this Committee on Labor, you want to recollect that that thing does not apply to but an infinitesimal portion of the work that men do who earn wages^ Mr. SuMNEKS. Is it not possible that even these men are so selfish that they can not afford to admit it ? Mr. DuNLAP. I do not understand the question. Mr. SuMNERS. Even if people had no consideration for their em- ployees, when they have men who are trained they can not afford to wreck them so as to have to go out and get other men and train them ? Mr. DuNLAP. My dear sir, that is one of the fundamentals of this science. It makes the employer take an interest in his employees. It opens his eyes, that he has to look after his employees as he has always looked after his machines. In other words, it is an enlightened sci- ence. It has been introduced all over this country. Mr. SuMNERS. But as your machinery becomes more complex the time of training becomes longer, and when you get a man well trained Mr. DuNLAP (interposing) . You can not afford to sacrifice him. Mr. Keating. Let us see if you are still following in your master's footsteps in what you have said. Mr. Dxjnlap. Do not say my master. I have got none. Mr. Keating. The man who has founded your science, Mr. Taylor. Here is from paragraph 166, page 1374, of this treatise .of Mr. Taylor: Where the labor market is large enough to secure in a reasonable time- enough strictly first-class meuj the piecework rates should be fixed on such a basis that only a fu-st-class man working at his best can earn the average amount called for. Thia figure should be, in the case of first-class men, as stated above, from 30 per cent to 100 per cent beyond the wages usually paid. The task idea is emphasized with this style of piecework by two things, the high wages and the laying off, after a reasonable trial, of incompetent men; and for the success of the system the number of men em- ployed on practically the same class of work should be large enough for the workmen quite often to have the object lesson of seeing men laid off for failing to earn their wages and others substituted in their places. That is not speeding up, in your judgment ? Mr. DuNLAP. That was, but in addition to that, it was the selection of men to do a particular job and he recognized the survival of the fittest, and that was the only thing he could consider. Mr. Keating. And is that the basis of your system ? 86 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. DuNLAP. No, sir. Mr. Keating. Then, you have departed from the teachings of your founder ? Mr. DuNLAP. Absolutely. Mr. Keating. You have repudiated Mr. Taylor, but retained his name? Mr. Dunlap. I am not here to defend the Taylor system. Mr. Keating. But you are here and advocate the repudiation of the Taylor system. Mr. Dunlap. No; I am not. Mr. Keating. That is the policy of the man who founded your system. Mr. Dunlap. He did not do any such thing. I said he was one of the chiefs. Mr. Emery. I suppose that those who pursue the building of steamships to-day do not follow Robert Fulton. The man who built the Mauretania did not follow out the example laid down by Robert Fulton. There is not a more dangerous form of argument known than quoting from a large volume. Mr. Keating. I appreciate that, but the witness has himself rather invited this form of discussion, and I have quoted accurately from Mr. Taylor's books. The witness does not question these quo- tations, and I think I have stated his position accurately when I say that he has repudiated the teachings of the so-called founder of the system. Mr. Dunlap. I deny it. Mr. Keating. Proceed, Mr. Dunlap. I have no further questions to ask you. Mr. Dunlap. All that I wanted to say in addition, Mr. Chairman, is that I have always regarded that experiment and that example and that statement by Mr. Taylor as about the most unfortunate thing that ever happened to the science. That has been established largely since, because it has been taken as the one demonstration of what the science means, when, as a matter of fact, it gives no indics/- tion whatever of the breadth and reach and importance and benefi- cence of the science. Now, finally, I want to say in reply to the point that Mr. London raised — ^Mr. London seemed to feel and tried to get Mr. Thompson to indicate that under scientific management every employer would take advantage of a man's necessities and get him to work for any kind of a wage, regardless of whether it was a living wage. I want to say that no intelligent employer under this intelligent system woTild ever think of domg any such thing. Now, in conclusion, I want to say that there is a leading editorial that. I have written for'my magazine to appear next week, and inas- much as it embodies a very careful statement of my personal views upon the subject, I should Jike to have it incorporated as a part of my testimony. Mr. Keating. Without objection, it wiU be put in as a part of his remarks. (The editorial referred to is as follows:) METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. 87 [The Knglneertag Magazine, April, 1916.] Dangerous Labor Legislation Now Before Congress— A Call for Prompt Action. (By the editor.) After full 25 years of work in publishing in these pages the standard literature of what is now recognized the world over as the science of industrial management, it is rather amazing to find introduced in the American Congress a bill prohibiting the most enlightened wage systems ever yet devised by man. The stupidity of this proposed legislation can best be indicated by giving the text of the bill itself, as follows: "in the house of RBPB^ISENTATIVES. "January 11, 1916. "Mr. Tavenner introduced the following bill ; which was referred to the Committee on Labor and ordered to be printed: "A Bill To regulate the method ol directing the work of Goremment employees. "Be it enacted, hy the Senate and House of Representatives of the United States of America in Congress assembled, That it shall be unlawful for any officer, manager, superintendent, foreman, or other person having charge of the work of any employee of the United States Government to make or cause to be made with a stop watch or other tinae-measuring device a time study of any job of any such employee between the starting and completion thereof, or of the movements of any such employee while engaged u^on such work. No premiums or bonus or cash reward shall be paid to any employee in addition to his regular wages, except for suggestions resulting in im- provement or economy in the operation of any Government plant. "Sec. 2. That any violation of the provisions of this act shall be deemed a mis- demeanor and shall be punished by a fine of not more than $500 or by imprisonment of not more than six months, at the discretion of the court." A similar bill, introduced by Congressman Van Dyke on the same date, January 11, 1916, would prohibit all time studies throughout our entire Postal Service — in which the element of time is of obvious and fundamental importance. Both these measures have been introduced at the behest of the leaders of the labor unions throughout the United States, and it should be at once recalled that pre- cisely similar legislation was adroitly incorporated as "a rider" in an Army ap- propriation bill by the last Congress. No public hearing was ever given upon the proposals, and the vast majority of Congressmen and Senators were so wholly un- informed upon the subject that the rider was passed by the House practically without debate. It was later thrown out by the Senate, yet in conference, the labor leaders were able to dominate the conference committee of the two Houses, and thus the measure became a law so far as the appropriations in that particular bill were con- cerned. We are further informed that the ringleader in the conspiracy to pass this damaging legislation without public hearing or intelligent debate was Congressman Buchanan of Illinois, who is now under indictment by a United States grand jurj;. Precisely the same tactics will be attempted in this session of Congress, as evi- denced by the fact that no hearings on the Tavenner bill have yet been granted by the Labor Committee of the House, and the appropriation bills for both the Army and the Navy are now certain to come up before such hearings could be held. In other words, the transparent scheme of the labor leaders and the labor Congressmen is to pass the measure by trickery and stealth, without opportunity for investigation of debate, and not alone to make the prohibition apply to all the arsenals and navy yards of the Government, but also to the private industrial plants of all contractors for machinery, equipment, and supplies for both the Army and the Navy. The necessity for exposing and blocking this legislation is so manifest that a com- mittee of 10, representing leading engineering societies, the National Association of Manufacturers, the National Meta,l Trades_ Association, and many local chambers of commerce, has been appointed to take active steps in oppositionj and Mr. Henry R. Towne, past president of the American Society of Mechanical Engmeers, has accepted the chairmanship of this committee. Voluntary contributions are being solicited, and within its limited means and the short time available for effective work, this committee will be able to do much in the way of supplying Senators and Congressmen with information exposing the fallacies of this reactionary and dangerous proposal. 88 METHOD OP DIEECTING WOKK OF GOVERNMENT EMPLOYEES. But all such committee work is necessarily impersonal, and Members of Congress are so constantly pelted with circular letters and printed matter of all kinds that they find it necessary to confine their reading to that which they know to be of special interest to their more intelligent constituents. Unfortunately, very few Oongressmett have any knowledge of the new science of industrial manageinent;-or^mated by Americans, developed by Americans, now m successful operation in thousands of American industrial plants, and- being rapidly introduced in Germany, England, and /apan— who are certain to be our most formidable competitors so soon as the war in Europe is over. Congressmen have read about "scientific management" m the newspapers, and they have heard about a few "efficiency and economy" commissions in governmental affairs, but technically and practically they know little or nothing about the new science. They do not understand, therefore, that the premium and the bonus to wageworkers represent the most advanced steps that have yet been taken, and achieved in solving the knotty problem of how to secure free, frank, and intelligent cooperatoin between worker and employer in increasing output— not through ' ' speeding up " or overwork, but solely through intelligent study and instruction in better methods of doing work. In thousands of cases where they have been intelligently a^pUed the premium and bonus systems have proved themselves a boon and a blessing to both workingmen and working women, oecause they have given an actual increase of wages to all grades of workers, and to those of brains, ambition, skill, and inventive genius they have opened numberless opportunities for advancement and promotion to high positions, which would have been impossible without intelligent instruction of workers of natural ability. -AH of this can be made perfectly clear to every man of common sense, but we have no time for any such educational campai^ now. The point to realize is that we are face to face with a serious and threatening situ- ation. The labor leaders and the labor politicians are deliberately planning to "put over" this legislation bytrickeryand stealth, because they reason that it will strengthen the labor imions and make more labor votes. The domination of the labor unions in . Great Britain, especially in the engineering trades, is both historic and notorious. They bitterly opposed the introduction of the power lodm, the sewing machine, the ' locoinotive, the air brake, the mower and reaper, the type-setting machine, and in fact every great labor-saving device that has ever been invented, upon the stupid theory that "it would throw men out of work." This proposed American legislation is of a piece with all such ignorant reasoning, and the definite plan of our labor leaders is to take advantage of this presidential year and force such legislation through Con- gress without hearing or debate. If they succeed, the time may come very soon when, like England, our most vital national interests may be imperiled. Less than a year ago the entire civilized world was shocked by exposure of the fact that through the arbitrary, dogged, and uncompromising regulations of the British labor unions, the armies in the field were actually short of munitions, while the British, the -French, and the Italian Navies were seriously threatened with a shorts^ of coal. This involved a sudden and alarming change in the British Cabinet, and David Lloyd George resigned the high office of chancellor of the exechequer to take the newly created and vitally important office of minister of munitions. It was only because he was the trusted leader of the radical and labor vote, ah orator of great power, and a patriot of dauntless bravery that Britain was able to bring about a temporary suspension of the labor-union r^ulations until the war is over. With us, the situation now calls for immediate action, and the one and only effective means available is through direct personal appeal to individual Senators and Congress- men. We therefore call upon every reader of these pages to at once telegraph or write personally in protest to both your Senators and certainly to the Congressman repre- senting your district. Let your telegrams and letters be brief, pointed, and just as earnest as you caji word them. Address them personally, sign them personally, and insist that Congress shall at least grant public hearings on the measures before they can be put upon the statute books. We are positively assured, by those familiar with the present situation in Congress, that this is the only possible means of now getting the attention of members of the Senate and House, because they are driven with the work of passing the bills for enlarg- ing the Army and the Navy, and in addition, the great mass of routine legislation m already weeks behind the usual schedule time. Bear in mind also that both Senators and Congressmen will be very' slow to take any action that may seem to place them in opposition to organized labor. They each and all desire to hold the labor vote, and only the bravest among them will stand openly for the right in this vital matter. Fortunately, in this regard we are armed with unequivocal endorsement from an authority on labor union affairs which even labor lead^jrs can not question. Mr. Louis D. Brandeis, who has been nominated for METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 89 the Supreme Court, is on record in unqualified indorsement and approval of "scienti- fic management. " For years past he has been a voluntary attorney and arbitrator for the labor unions, and it wJUl be recalled that he won nation-wide distinction as attorney for the shippers in their protest before the Interstate Commerce Commission against the large increase in freight rates which the railroads insisted upon having four years ago. The brief which he presented before the commission at that time is remarkable for its brevity, its clear reasoning, and its convincing force; and the fol- lowing extracts from the document are directly pertinent to the present situation: "Under scientific management, the management of the business assumes toward the workmen a wholly new function .''•'t'^stead of the prevaihng 'putting it up' to the employee to do his work with suchTsmliiliis as may be given through force or induce- ment, the management, under the new science, assumes the responsibility of enabling the employee to work under the best possible conditions of perfect team play. It undertakes to instruct Jum definitely what to do and the best method of doing the particular work. It undertakes to provide him the best tools, and with machines in the best condition. It undertakes to furnish him with assistance to perform those parts of the operation requiring less skill than his own. It keeps him constantly supphed with appropriate material. Acting in full cooperation with the workmen, the management thus removes all obstancles to the workmen's full performance and eupphes all aids necessary to secure full performance. The management thus assumes the burdens of- management, and relieves labor of responsibilities not its own." (P. 14.) ' ' The larger wages are made possible by larger production ; but this gain in production is not attained by 'speeding up.' It comes largely from removing the obstacles to production which annoy and exhaust the workman — obstacles for which he is not, or should not be made, responsible. " (P. 35.) "The claim has been made that scientific management and labor unions are incon- sistent; that the organization of labor presents insuperable obstacles to the introduc- tion of scientific management in railroads and other indutries where unionism is potent. This claim, we believe, is wholly unfounded in fact. Collective bargaining is alike an important function under scientific management and under the old system. " (P. 55.) If public hearings be granted, any needful number of workers under the bonus and premium plans will appear before the Labor Committee of the House to give personal testimony to their satisfaction with the new system of w^ige payments. To indicate the character of this testimony, the cbminittee of ten have begun to collect letters from such workers, and these will be laid before Members of Congress as promptly as possible. The following are sample letters which have already come to hand: [From John Geo. Kreis, Gang Boss, Acme Wire Co.; New Haven, Conn.] "As gang boss for the past five years, I have had a very good opportunity to study the conditions an operator has to work under, both before and after this system had been installed in this factory, and I am glad to say that I have found everyone of my operators to be better satisfied since working under this system. "My operators also make more money and do not have to work so hard. The result is that they are healthier, better dressed, and more prosperous, and thereby also become better citizens. Hoping this bill does not go through, I remain, etc. " [From Theresa Godino, employee of the Acme Wire Co., New Haven, Conn.] , "I have worked four years at machine work for the Acme Wire Co. "The last three years under the Taylor Bonus System. I have made more money under better conditions than the first year I worked here. "I have worked on piecework in another factory, and I am better satisfied with the bonus system here. " [From S. F. Gilla, employee of the Sewell-Clapp Envelope Co., Chicago.) "With my experience in scientific management I have found a betterment of con- ditions in S. C. Env. Co. Very efficient in labor and produce. With my part of work at time study on task and bonus have found it very interesting and educating. "The old method of payment means just one pay envelope on pay day, while the bonus plan makes a willing worker and puts an extra red envelope into his hands with lots to gain and nothing to lose." 90 METHOD OF DIEECTING WOBK OF GOVERNMENT EMPLOYEES. [From E. S. Smiley, pmployee ot the Eastern Mafacturinung Co., Beaver, Me.l "I am pleased to reply to your questions as to how I regard the conditions under tlie Taylor system and conditions under the old way, and will say; First, I get more money in wages; and second, that there is no lost time. And in many other ways I find the Taylor system much better for the work people." Thousands of such letters, from operatives in every line of industry and m every part of the United States, can and will be collected should that be necessary. As to how our leading engineers and inventors and our foremost employers in engineering lines feel upon the subject th,e-|(ilowing letters give speaking testimoay. We are glad indeed to be able to intrOctugL.ihese letters with one from Thomaa A. Edison, who began life as a newsboy, then'became a telegraph operator, then educated himself in electrical science, and through his numerous and revolutionary inventions has probably given profitable employment to a larger number of men and women thaji any other man alive to-day. [From Thomas A . Edison, dean of American inventors.] "In my opinion, the bill introduced by Congressman Tavenner is based on a fallacy. It is an attempt to prevent efficiency, and would be disastrous to labor and to the public. "The worst enemy of all the workers is an inefficiently managed shop, and yet the labor leaders can not comprehend the fact — possibly because it is based on mental processes of a primary character. "There are many ways whereby labor leaders can improve conditions by legisla- tion, but this bill of Congressman Tavenner is not one of them." [From Dr. Elihu Thomson, past president, American Institute of Electrical Engineers.) "I agree with you most heartily in the stand you take. I would indeed go so far as to require enlistment to fill places in arsenals and shipyards. ' ' You are plainly right in pointing out that the move probably contemplates includ- ing all contractors working for the Government." IP I . M Hcrr, president, Westinghouse Electric & Manufacturing Co., East Pittsburgh, Pa.) "This bill is reactionary and bad for both the interests of the Government and its employees. If enacted into law, no Government employee could be paid on any system except the stated day wages, now practically obsolete in all progressive and modern industries. It would close the door absolutely to any possible improvement in the manner of compensating labor, whether skilled or unskilled, no matter how beneficial such a plan might be to the employee. ' ' The bill does away wiOi all improvements in ways of paying labor thus far devised, and absolutely prevents exact and scientific methods or other possible improvements from being considered. It is against the interests of both Government employees and the Government itself, and will decidedly set back all progress that has been or can be made in wage payments. "The payment of labor at a fixed rate per day tends to destroy individual initiative and to level down instead of properly and fairly rewarding the better workers. "This bill is pernicious and should be defeated." [Fjom Coleman Sellers, jr., president, William Sellers & Co. (Inc.), Philadelphia, Pa.] "This measure appears especially vicious; it is inimical alike to the true interests of the workman and of the employer. "Its object is clearly to prevent increase of output, and to limit the earnings of the workman to the rate of wages decreed by his union. "It is intended to hamper the efforts of the employer to improve methods, and to prevent the efficient workman from realizing the advantages which should accrue to him on account of his superior skill, intelligence, or industry. "Time studies and analysis of procedure are not made to force men to work harder, but to make their labor mpre efficient by eliminating wasteful or useless effort, by improving methods, and by introducing .devices and appliances which will improve output without increasing labor." [From Otto H. Falk, president, AlUs-Chalmers Manufacturing Co., Milwaukee, Wis.] "To any unprejudiced person a mere reading of this bill should be sufficient to reveal its true character and show how entirely inconsistent it is with any just prin- ciple for a fair basis of compensation and dealings between an employer and employee. METHOD 0¥ DIRECTING WORK OF GOVERNMENT EMPLOYEES.' 91 Of course, the only reason a proposed measure of this kind has any standing at all is because of the backing given to it by organized labor, and the fact that it has such support demonstrates better than any other argument the injustice of the position of organized labor in this regard. If the principle be true that 'the laborer is worthy of his hire,' there is no good reason why a suitable bonus or reward should not be paid for extra effort or ability." [From John A. Topping, cliairman, Republic Iron & Steel Co., New York.) "House bill H. R. 8665, should it become a law, places a premium on inefficiency, extravagance and waste; furthermore, it suggests class legislation of the most vicious type. In view of all that has recently been written in support of preparedness, coopera- tion, and efficiency, it is hard to conceive how reactionary legislation of this kind could command serious support in Congress, for this bill ignores the practical lesson taught us by the great Eviropean war, which has brought home to us with telling force what organized efficiency, thrift, and cooperation has meant to Germany in ner present struggle. "The influence of the proposed bill should be obvious, for if passed, it would stin^u- late inefficiency, wastefulness, extravagance, higher costs, and additional burdens for the taxpayer to carry. '-' [From Elmer L. Corthell, Dr. Sc, president, American Society ol Civil Engineers.] "It is my decided personal opinion from careful study of industrial conditions in this and other countries, covering many years, that the result of the proposed act will lead fast to industrial and commercial disaster. "My professional experience has brought me into rather intimate relations with nearly all the countries in the world; consequently, I can speak with knowledge. "All observing and fair-minded men who have had the opportunity to trace the development of trade unionism appreciate its disastrous effects upon the industry and foreign trade of Great Britain, in which we are becoming a close second. "Every effort should be made to remove rather than increase the burden on ouf industries. This bill, if enacted into law, will lead to irreparable injury and loss to the industry, commerce, and particularly the foreign trade of this country." [From John F. Wallace, formerly chief engineer of the Panama Canal, now president of WestinghouSB Church, Kerr & Co. (Inc.)., engineers and constructors. New York.] "I would say that this bill is so boviously to the disadvantage not only of the United States Government but also to all employers of labor as well as to labor itself, that it it difficult to conceive of its finding favor with our Senators and Representatives, who, it they are not, should be broadminded enough to see that efforts of this kind to turn back the hands of the clock of modern civilization and the efficiency upon which it is necessarily based are antagonistic to the best interests of all concerned. "The prosperity of the American Nation outside of the personalities of its broad and progressive citizens has been due to the introduction of labor-saving machinery^ and the substitution of brains for manual labor in all classes of human endeavor, ana it should be apparent to employees in the mass as much as to employers that increased efficiency in production has not only bettered the condition of workmen but also increased the available profits out of which the compensation to labor is paid. "While this bill is apparently only directed against government employees, it will doubtless eventually be construed to cover not only employers of labor who work directly or indirectly for the United States Government but also extend the same restrictions to private employers of labor. "Your efforts in giving this matter publicity and securing the necessary cooperation to check it should be much appreciated." [From Henry D. Sharpe, treasurer Borwn & Sharps Manufacturing Co., Providence, R. I.] "I beg to state my emphatic protest against all such efforts to interfere with the simple and natural relation of employer and employee, either in Government shops or by indirect means in the great industrial works of the Nation, for the following reasons: "I. There is nothing in so-called scientific management, or similar plans, that is unethical, unfair, or subversive of corrective relations between employer and em- ployee. Congress itself, by one of its committees, some years ago made an investiga- tion following the remarkable results attained in the Watertown Arsenal, the report being a general indorsement of methods there used. 92 ' METHOD OP DIEECTIN-G -WORK OF GOVERNMENT EMPLOYEES. "2. Critics of scientific management, or any bonus systems of reward, are either theorists, cranks, or those who have axes to grind, including the leaders of so-called organized labor. 3. The industrial leaders in our country, who really know about industrial life, not only deprecate the practice of Congress in this matter, but consider the policies so advocated as absolutely contrary to an enlightened practice. "4. Congressmen are ignorant to the point of stupidity in pursuing the subject aa they have, in the face of so much intelligent practice m all our leading industries whiich encourage payment of work by performance, the workmen themselves thor- oughly appreciating such methods of rewarding their labor. 5. Payment of work according to performance is the only really American way to remunerate the industrial worker — America is supposed to bespeak opportunity, and opportunity to earn an increased wage accordiig to performance should be his. "6. The present tendency of legislation is strangely out of harmony with what is generally known — that a very great deal in oiu- American life is utterly inefficient as well as extravagant. Why should not the Government lead in national economy by insisting upon having its own industrial work conducted efficiently? This meanfl efficiency of labor, the workman's cooperation being secured by added remuneration. It does not mean faked up figures which please the eye of Congressmen but deceives "no business man in this country as to the extravagant way in which national work- shops are run. "7. Congress in enacting such legislation is making itself ridiculous and serving nothing but the habits of lazy people, aa well as committing a downright injustice to the workingman who wants to make his way even in Grovemment employment." (From William I,. Ward, president Russell, Burdsall & Ward Bolt & Nut Co., Fort Chester, N. Y,] ' "By exercising patience, forbearance, and promptly adding to our fighting strength on land and sea we may escape a serious war with some foreign country. "But all thinking men, and most men who only think occasionally, feel assured that after the foreign complications are settled nothing can prevent a strenuous com- mercial war with competitive nations — one that no high-revenue wall can protect from serious losses unless we use the utmost skill and energy, abolish all slap-dash methods of manufacturing, abolish all waste of effort, waste of material, waste of plant investment, and organize our industries on common-sense, scientifically efficient fines. "It will not be a contest with weakened nations, but a trade conflict with people hardened and disciplined by the sacrifices they have endured. Their fight will be a trade fight for very existence ; ours to hold and add to our wealth. If we are hampered by unwise restrictions, if our Government enacts laws to discourage effort, if the demagogue is to be in the saddle, we had better save our money for ships and arma- ment and retire from business. "We can not successfully cope with these coming events unless we develop far more strength, resource, and ability than we have at present. Our legislators must recog- nize the bigness of their positions and should deal with the situation not tor the benefit of a class or for party advantages, but for the inaiirance to the whole people of the United States of their rights to carry on their enterprises in a manner to make for our success at home and abroad. "We will have to be more temperate in our living and have a greater consideration tor the rights of both labor and capital than ever before. Employees of all classes must have a greater share of the profits. The employer must be allowed to direct the efforts of the employee in order that the output per man per year shall be greater than that of any other nation. The health and well-being of the employee must be safeguarded, and finally the cost per piece or per pound must be as low as that of any other nation or our exports will be killed and business initiation prostrated. "We have every requisite in this country to command the trade of the world. Are we big enough and broad enough to do it, or can we only learn the lesson through war and great hardship? Time will tell . ' ' Mr. DuNLAP. Before we adjourn, Mr. Towne was questioned very closely upon the subject of contributions being raised to carry on the work of this committee of ten. I want to confess that I was the first contributor to that fund in the shape of my traveling expenses to come down here to Washington to find out what this situation is. I am a newspaper man. I have been at the game for 42 years. I have been aU through it. This system has been introduced all over this country. I know its power, its following, and as a newspaper man METHOD OF DIBEOTING WORK OP GOVERNMENT EMPLOYEES. 93 I am going to see whether or not Congress will pass any such bill aa this myself, regardless of this committee. (Whereupon, at 11.20 o'clock p. m., the committee adjourned to meet at 10 o'clock a. m., Friday, March 31, 1916.) Committee on Labor, House of Representatives, Washington, D. C, March SI, 1916. The committee this day met, Hon. Edward Keating presiding. Mr. Keating. The committee will come to order. Mr. Emery, whom do you wish us to hear first this morning ? Mr. Emery. My first witness is Dr. William Kent, of Montclair, N. J., who is the author of very well known books on this subject. He has written quite extensively, and among his books are Investigating an Industry and Mechanical Engineers' rocket Book. Dr. Kent has been interested in this matter from the very beginning. STATEMENT OF DR. WIIIIAM KENT, OF MONTCLAIR, N. J. Mr. Kent. Mr. Emery has introduced me as the author of several books. This book [indicating] was pubUshed originally 21 years ago, and since that time there-have been 100,000 sold. This book [indi- cating] was published 2 years ago, and over 1,000 copies have been sold. I am a consulting engineer by profession, and have been connected with manufacturing industries in one way or another — as an employee, as superintendent of a department, as general manager, and as salesman. I think, therefore, I have been able to look at this labor question from aU sides. I have been a student of pohtieal economy for over 40 years, and have done considerable work writing on economic subjects. I think that is a sufiicient qualification. I believe I was the first man to adopt the Halsey premium system. I think that was about 1888. I met Mr. Halsey^ on Broadway, and he told me he had a system that he intended to install the next year, if he got the opportunity. I asked him if he had any objection to installing it in a tactory of which I was general manager. He stated that he had not, and I started in right away. At the time I started in with it an apprentice was getting a dollar a day and was doing some work that I did not know much about. He was a httle raw on it. I told this man that if he exercised his ingenuity a Httle bit he might find some way of getting rid of lost motion, and that he might do higher class and faster work. Now, Halsey had recommended that I be very careful about starting this thing, and advised me against giving too high a premium, because he said that no one knew how fast the work could actually be done, and that we might be astonished at the amount that could be accomphshed in a certain time. We started in and made a bargain with this man by which he was to get one-quarter of a cent for each piece that he made above 100. In about a week he was making 300 instead of 100, and his wages went up correspondingly. We started gradually, trying one man after another, and in about six months the system was introduced in the whole factory and worked well. 94 METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES, That system was published by Halsey two years later. It was adopted in England and Scotland, or, Scotland adopted the Rowan system, which was a modification of it. There has been some uncertainty, apparently, in the mmds ot the committee and even of the witnesses themselves, as is shown by the discussion, as to just what' these systems are and what is accom- plished by them. I have written a short statement which I have here and which I think shows the difference between the different systems. The first applies to day work. That means $2 a day and 200 pieces. The result is that nobody is satisfied. The workman wants $3 a day; the employer wants 300 pieces, while the consumer wants lower- priced goods. Then comes the piecework. The employer offers and the work- man accepts 1 cent a piece. Nobody knows what a fair day's work is. The piecework stunulates the workman to acquire extra skill and to avoid wasting any of his time, but he works in the old way with some useless motion. He doubles his output and gets $4 a day, and the employer cuts his rate to $3. Then the workman stops ms improvement in speed and works regularly at the $3 rate. In another shop we have the same original condition. They adopt the Halsey premmm system, giving $2 a day for 200 pieces or less, and one-quarter of a cent for each piece over 200 pieces a day. The employer does nothing to study lost motion, but he gives the workmen facilities, such as good tools and prompt supplies of materials. The workman, stimulated by premiums, acquires ^eat skill and advances his earnings. He gets for 200 pieces $2; 400 pieces, $2.50; 600 pieces, $3; 800 pieces, $3.50. The Rowan premium system is a sliding scale of premiums, so that the maximum wage for any output is $4 per day. The Taylor system does not depend on the workman to find out for himseu the best way of working, but puts a time and motion study man on the problem, and he finds out that the saving of lost motions makes it possible for a good workman, without any undue speeding, to make 400 pieces a day. He offers $2.50 a day for any product below 400 pieces, $3 a day for 400 pieces, and one-half cent per piece above 400. The Hahey premium system, the differential piece-work system, the Gantt task and bonus system, and the Emerson efficiency system of fixing rates are used by Taylor-system men, but the amount of wages under any one system is a matter of bargain or agreement between the employer and the workmen. Last night a good deal of time was spent in a discussion as to how much should be paid for the ninth pair of shoes. There was a great deal of misunderstanding, apparently, between the gentleman who asked the questions and Mr. Thompson, who answered them. They did not seem to get anywhere. In answering that question I would say that the price to be paid for the ninth pair of shoes is a matter of agreement between the employer and the employee. It seems to me it is entirely a matter of what is fair, and it may run from 50 cents up, on the theory that the employer has furnished the employee with the facilities for doing the worlc, and that therefore he is entitled to some profit. Perhaps they split the difference, and make it 50 cents. In another way, you might say that the man is very anxious to get nine METHOD OF DIRECTING WORK OF GOVERNMENT E:»rPLOYEES. 95 pairs of shoes, and therefore would be willing to pay a dollar for the extra pair. Perhaps they agree on that. Or, perhaps the employer says, ' There is a big profit in these shoes, and I want to stimulate that man to the extent that he wUl make 10 pairs of shoes, and I am going to give him $1.50 or more." All these ways have been adopted. If 1 cent is the standard basis, or price, they make it one and a half, or 2 cents, according to the condition of the business. It is, to my mind, entirely a matter of bargaining and agreement between the parties as to how much that shall be. As to whether it is fair or not, that, I think, is a question for discussion between them, or between them and a board of arbitration or a court, if it is necessary. I think it is certainly entirely outside of the question of this bill. I shall take up now a little matter that was mentioned last night. Mr. Taylor's work at Bethlehem was mentioned. Senator Borah did a great injustice to Mr. Taylor when he picked out a few para- ffaphs in regard to Mr. Taylor's work. By elaborating on them and y pi'cking out just those paragraphs, a false impression has been created in the minds of the people. I am very sorry that Mr. Dunlap made the statement last night that he wished Mr. Taylor had not done that; that that was a thing that Taylor was wrong about. I wish to take exception to what Mr. Dunlap said, althou^ he is our own witness in that matter. I feel that if anyone will read the whole of that story and know exactly what Taylor did there, exactly how he did it, aind the reason for his doing it, it will be agreed that he did exactly the right thing under the cu-cumstances. Any man in charge of a number of men loading pig iron would say that the best way to do it is to do what we do in other matters of life, and that is to select the men who are best fitted for the job, or the animal or the machine best fitted for the job. I might say that members of Congress are sent here for that very reason. You are picked men; you are supposed to be the men for the job. Sup- pose, instead of having men carry that pig iron in their arms, you should say, "We will have horses do that." We wUl say that there are three kinds of horses. You may select a Percheron or a Clydes- dale, or you can get a slender race horse, or, again, a weak horse that draws a grocery wagon. Of course, we all know that the best thing to do is to get one of the big horses that you can work so many hours a day with so many rest periods, to carry that pig iron at so many dollars a day. The man will say, ' 'I have a valuable horse here ; I must not over- work him." As we are not back in the dark ages and aU men can not do that kind of work, the best thing to do is to get a man of the Percheron or Clydesdale bmld, a man who can do the work easily. Now, Mr. Taylor picked out that kind of men. Did he do an injustice ? That is the question. After it was rumored around that these men were getting $1.75, the men began to come in from all around the coimtry to get these fine jobs. The question arose whether $1.85 was too low. The proof of this is that these men came to get these i'obs and wanted them. They were offered higher prices to go to 'ittsburgh, and they went, but they came back, because they were not satisfied with the conditions that they found. So I say in doing that Mr. Taylor did nothing imethical and nothing inhuman or unfair. 96 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. Let US take the New York police force as an example. I do not . know that what I have to say will apply to Washington, but I suppose it wiU. You get men of splendid build and fine physique. They have to be that kind of men, because they have to stand all sorts of weather. You have to have a man of courage, and you pick out these men very carefully. Probably you do not pay them enough, but that is another question. If you want a fireman who can climb ladders and who can be ex- posed to danger, you pick out a splendid class of men. They niay not be paid enough, but the selection is the same kind of selection that we use. It applies equally to all these classes of men. The post office has been mentioned as an example. It would be a good thing to use the Taylor system there. Instead of having these weaklings, as many of them are, although there are some splendid men among them, carrying these heavy bundles, and using their legs to carry them, they could give them an automobile, or give them good facilities to carry them. I would rather see the people of this country pay a little more for postage, if necessary, to give these men proper compensation. If you are going to have them use their legs to carry heavy material, get the kind of men that can stand the fatigue. That would be scientific management for the post office. Now, let me take up this bill. I congratulate the conunittee on what it has done in striking out the "whereases." I congratulate it also on making the amendment. It shows that the committee is not hidebound, but that it is willing to reason and to try to make things right. If they can strike out the enacting clause, it will be better; if they can postpone it for one year, it will be better still. While the preamble is stricken out, it gives us, as well as we can get from any other source, the idea on which the biU is based. It makes certain statements, and these statements have been denied by other witnesses. The question is whether these statements are true or false, and is one that requires investigation. That is what I ask the committee to do — to in.vestigate the truth of the statements of this preamble. I shall not take up your time to give my opinion on the subject, because it would be an opinion, and I do not think you want opinions. You want facts. I hope you will get some from Gen. Crozier this afternoon. What is the underlying motive of this bill ? So far as I have been able to discover it, there are two motives, one of which is absolutely praiseworthy. That is human sympathy. I think you are sympa- thizing with the laboring man, and that is one of the motives of tnis bill. I can stand behind you in that, for my whole life has been in sympathy with the laboring man, and I think that the fundamental motive of the real, honest supporters of this bill is s3Tnpathy. There is, however, another motive that is not so praiseworthy. It is an unreasoning fear — fear that something is going to happen to some- body; that workmen are going to be thrown out of work by scieiitific management. I think that is one of the fears. It is the same fear that led the English workmen over 100 years ago to burn down mills; it is the same fear which caused the opposition to the steamboat, the sewing machine, and the linotype. The linotype is now used in the Government Printing Office, but I suppose you are all familiar with the fact that the linotype was introduced all over the country before it was put in the Government Printing Office. The printers have not METHOfi Of CIRECT1K6 WOBK 01' GOVEBSfMENT EMPLOYEES. 97 had their wages reduced, norli'ave they been thrown out of their jobs. There are, in fact, more printers to-day than ever before. There have been charges against scientific management. They have claimed that human beings would be treated hke machinery, and that they would be consigned to the scrap heap. These are questions of assertion. There is no use of answering them aU by Opinion. Lotus trace these charges to their foundation, and if they are not untrue, let us find to what extent they are true. If you find that the last drop of blood is being driwn, and that the men are con- signed to the scrap heap, try to find out, who has been doing this. Where is the man, and what is the reason ? Those are the questions to be answered. Why was he thrown into the scrap heap ? You will find, it it is true, that it is not due to scientific Management, but to the abuse of it. These conditions should be corrected it they exist in fact. Get after them and find out the real reason why they exist, but do not complain and say that we must throw off the stop watch. We are killing many men to-day in the coal mines. The thing to do is to investigate the causes of the explosions. We do not say that we will have to give up the coal because these men are getting killed. We are killing many people on the railroads every year. We are not killing as many passengers as formerly, but we are killing a great many who get on the tracks. We do not stop the railroads On that account. The thing to do is to get at the particular cause of the accident and to stop that particular detailed cause. The thing to do is to get the facts, and figure Out just what is the true situation, the true condition. What ht.S the committee done in regard to this matter ? We know that there wa,s a committee that investigated Watertown Arsenal. I believe that committee was composed of Mr. Redfield, Seci'etary of Commerce, and Mr. Wilson, Secretary of Labor, and others. T^hey investigated the evils that we have heard so much about four years sgo, and they recommended that no legislation be had on the subject. What new facts have you obtained since then? Nothing new to show that the stop watch in the last four years has done this. I have not found any evidence or anything to indicate that. The thing to do, as I say, is to find out what the conditions are that exist now at Watertown Arsenal. I am going to submit this proposition, that you employ Scientific manageinent to find out the truth. I do Hot mean necessarily that you should use the stop-watch method, but sc ienti£.c investigation, i ind out the facts by the best methods possible. I auggest that you go about it in this way: Instead of emy loying Prof. Hoxie, go about this in another way. He and his commission of labor got together and wrote a book, as you will remember. If you will retd that book you will find what a muddle was m£.de of the subject. They concurred in a report that you can not make head or tail of . That is not the Way to do it. That is not the way to find out the facts. 1 ind' out who does know about Watertown. I suggest that you appoint a committee composed, say, of Gen. Crozier, for one, Mr. Aliff. s for a second, and Mr. Mincvf Chipman for a third. Mr. Chipman has investigated Watertown Arsenel and probably knows more about it than anyone, with the exception of Gen. Crosier. If those three men go there, let them inspect the books, the her 1th records, the phy- sicians' records, and every other record, and, get all the facts on recbrd. 36162—16 7 ■ 98 METHOD OP DIRECTING WOKK OF GOVEENMENT EMPLOYEES. Then let these men sit around a table and draw up a paper saying : "We have found the f(.llowing facts and agree on these conclusions. On these things we concur. On the following things we disagree as to such and such com lusions." There may be three different reports; there may be two rgfiinst one. Whatever they do, they bring in a majority report showing the facts on which they require more light and in regard to which they take more time and more testimony. Then, let us see if we can not narrow it down, and let that commission come before the committee; let them state their conclusions and be examined £.nd cross-examined, and then let the committee put in a majority and minority report.. I submit that is the sensible way to go at the thing and find out the truth. Mr. Denison. Eid you say Mr. Chipman? Mr. Kent. Yes. He was employed as counsel by the laboring men. He has not yet reported for the abolition of the stop watch. If you can get a man who knows that the stop watch is an evil thing, put him on the committee. Mr. Denison. Could we get him on the committee 1 Mr. Kent. I think so. I want to say something more about the amendment to this bill. It is an amendment that cuts away, apparently, half of its poison. Instead of prohibiting the stop watch absolutely it only prohibits its use for the purpose of fixing a standard of service. They can use the stop watch if it is confined to the discovery of defects of machinery, the slippage of bolts, or the imperfection of materials, but you can not use it if it has anything to do with standardizing the time of the workmen. I have made some experiments myself. We had trouble once in the making of bolts. The trouble was that the same bolts were made of different diameters, so that a shifting of the belts was required. We found that it was not a question of the time that it would take a man to do this thing. It was a question of combina- tion. The time-study man said that it^took all the way from 10 to 15 minutes to perform a certain operation. Now, what was the rea- son? The belt had to be shifted several times, and sometimes the man could do it in 10 seconds, and sometimes it took a minute. The man bungled sometimes. Why? He did bungle, but we found that he had a rather loose belt and belt shifter. Well, the thing to do was to put in a good belt and bolt shifter. Is that a barbarous way to do things ? It is a question of which system is the best. Have a man work one day on one system and one day on another and find out. If you do that, how are you going to distinguish between the man and the machine? If you use the stop watch on a man, you say it is criminal. Did I do anything crLmmal when I investigated in regard to the bolts? Don't you soe how absurd it is? Don't you see that it, is absurd to try to settle that thing and say it is criminal for this purpose and not for the other purpose ? I think this bill is utterly vicious and abominable. I hope that the committee will postpone legislation. I do not ask them to report this bill how. I do say, go" and investigate the conditions now. We have other quostions, much larger questions, that should be con- sidered now. There is the Mexican' question, which deserves a good deal of attention. There are other quostions which should come before this one. METHOD OF DIKEOTING WORK OF GOVERNMENT EMPLOYEES. 99 Have a committee continue for a year and let a report be made on this question next year, after a scientific investigation of the subject. Mr. Smith. Are you a manufacturer at the present time ? Mr. Kent. No, sir; I have written several books on this subject. Mr. Smith. Yes, sir; I have heard of your works. You have been a mechanic ? Mr. Kent. Not exactly a mechanic. I have been a superintendent and a manager. I have done a good deal of work myself, but I did not learn a trade. Mr. Smith. You are not in entire sympathy with Mr. Taylor's method of getting facts and figures ? Mr. Kent. Absolutely. Mr'. Smith. Do you think it was right for him to pick out the best men in the country ? Mr. Kent. Certainly; the same as we would pick out policemen and firemen. Mr. Smith. The same as the men are picked out for the purpose of presenting this matter to this committee? Mr. Kent. We did not pick them ? Mr. Smith. Well, you have come here with the finest legal talent in the United States. You have submitted the brief of Mr. Brandeis, now a member of the Supreme Court of the United States, or to be, and Mr. Emery is one of the most celebrated attorneys in the United States. What chance do you think the ordinary individual would have in presenting the case you gentlemen have presented here ? Mr. Kent. The workmen themselves in the past did ask Mr. Bran- deis to present their case. Mr. Smith. Are you in sympathy with Mr. Brandeis's position, as expressed in his brief? Mr. Kent. I can not remember just now what the brief said. I read it very hastily. My impression was favorable at the time I read it. Mr. Smith. You think the wages should be fixed by the employer? Mr. Kent. Certainly not. Mr. Smith. I thought you said the rate was estimated, and then if the operator made more units in a given length of time, it was agreed between him and the employer what extra compensation he should receive ? Mr. Kent. That should be agreed upon with the employer or dis- agreed upon, as they see fit. Mr. Smith. I understood you to say that the workman at first should be given so much a day for his day's work. We will say, for instance, that he makes 20 units ? Mr. Kent; Yes, sir. Mr. Smith. And if he makes 21 units the employee should be paid according to the same rate that he would get for the 20 units, but the employer and he should agree as to what the compensation should be. Is that right? Mr. Kent. It is a matter of agreement. Mr. Smith. He starts at $2 a day? Mr. Kent. I merely took that as the basis that had been paid. Mr. Smith. How is that fixed — ^by the employer or the workman? Mr. Kent. Sometimes by the employer and sometimes by a trade union. It may be fixed in a number of ways. I referred to a case 100 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. in a factory where they got $2 a day, and there were 200 pieces, and nobody was satisfied. Mr. Smith. I understood that, but when you say that the day's wages are not fixed by the employer Mr. Kent (interposing). An employer opens a factory and says, "I am going to pay so much a day for workmen." That is the offer that he makes. Mr. Smith. He fixes that himself ? Mr. Kent. Yes; but he can not fix that too low. Mr. Smith. If you will pardon me, I should like to refer to the shoe illustration again. Do you think that the piece rate should not con- tinue at the same price as is paid for the number of pabs that make a day's work ? If he makes in excess of that, should he not be paid at the same rate ? Mr. Kent. I think I have said in my direct testimony that that was a matter for agreement, according to the conditions. As I remember it, $8 was the price for the eight pairs of shoes, and the question was how much should be paid for the ninth pair. Mr. Smith. And you thought it should not be the relative prices paid for the eighth. Mr. Kent. I said that the matter could not be determined by us, I said it would be a matter for agreement between the parties, accord- ing to the condition of the business. Mr. Smith. Did Mr. Brandeis think it should be the same relative rate for the eight pairs ? Mr. Kent. I do not remember. I said in my testimony it should be anywhere from 50 cents up to $1.50 — that is, give a higher rate for the excess. If the manager said that he wanted to use lots of shoes, it might pay to pay a higher rate. Mr. Smith. That extra price, whether it is called a bonus or extra compensation, has never been standardized by the Taylor system, or any other system, has it ? • Mr. Kent. No, sir. Mr. Smith. And the employers do not agree upon the price that should be paid ? . Mr. Kent. Not only that, but an employer may offer different bonuses on different jobs. Mr. Smith. Then, there is no uniform price to pav for the extra labor? ^ ^ Mr. ICent. The premium should be from 33J per cent up. If you offer less than that, it is not enough to stimulate the men. Mr. Smith. A gentleman has very Idndly presented me with a copy of Mr. Brandeis's brief. It is very interesting. You will find an illustration given by Mr. Sumners here, and also an explanation by Mr. Brandeis. The contention seems to be that the extra compensa- tion should be the unit of value paid for each pair of shoes based on the day's work. This is not at all clear to me, and with the com- mittee's permission I should like to read from page 46 of Mi-. Brandeis's brief. It reads as follows: Mr. Brandeis. Taking this very matter of the piece rate that CommisBioner Prouty referred to, if a man, for instance, had been earning, ordinarily, $2 a day, at a given number of rates representing, perhaps, 10 pieces of this work, then, if he makes 11 pieces, he gets $2.20, and if he makes 12 he makes $2.40, and the like. METHOD OF DIRECTING WORK OF (JOVEKNMENT EMPLOYEEb, 101 That was exactlj^ Mr. Sumner's question, and Mr. Brandeis's understanding of it was that the man should not, divide the pay for the extra pair of shoes that he makes with the manufacturer. Why is that? Because the manufacrurer's profit for the whole industry wrapped up in each individual share of shoes, being just the same for the first pair, the eighth pair, the tenth pair, or the twelfth pair ? Let _me call attention to one more thing in order to show how indefinite they are in their conclusions about this. I want to call attention to the "whereases," and the "as it were's." This appears on page 47, in answer to a question along the same line. Mr. Gantt was on the witness stand and he and Mr. Brandeis were trying to get together. I want to read about five lines: Mr. Brandeis. That is, he gets a piece rate, as it were, after he has reached the new standard; then he gets a piece rate? Mr. Gantt. In other words, it is different work for the unskilled and for the skilled. When the man becomes skilled, becomes practically in the expert class, you might say, then we pay him piecework; but we teach Mm how first. I remember when I was a boy at school we came across a fine in Virgil that had about five adverbs in it, and nobody- could translate it. The professor said, "That means beating around the bush." Now, in those five lines which I have just read, I find these phrases; "that is"; "in other words"; "as it were"; and "you might say." It seems to me that is pretty indefinite. I think any of you who have employed labor can tell just as soon as a man picks up a tool whether he is skilled or not. I believe a great many men who are capable of doing a lot of work in a day would not work one day if a man was standing around and holding a watch. Mr. Kent. Why not ? Mr. Smith. Weil, it affects the nervous system. There are a great many employments that this would not apply to. I do not know how many men are working in factories and so on, but I can say that so far as agriculture is concerned, we pay our men 13 a day. That refers to common labor. Last summer we were glad to get them at that price. Why ? Because the cities are taking them up, and the opportimities are so great in the cities that you can not get them to go to work. I am in favor of efficiency. I reahze that the employers share with the man and are glad to see him get along. They start a man out with a wheelbarrow, and after a while he gets to be superintendent. They are glad to see him get ahead. Now, you have the benefit of skilled counsel — the best in the United States. I know that. I know that a good lawyer is one who can present the good side of any question. As to Mr. Taylor's system, if anyone who was impartial could hear some of the remarks that have been made about it they would not be so highly impressed. They talk about the increase of wages under the system, and compare labor paid by the day and by the piece. If a man makes 10 pieces, and that is 2 pieces or 2 units more than a day's work, I do not see whey he should not have a relative amount^ You can not gauge any business by the very exceptional man or the high-grade man. Mr. Kjent. Have you asked me a question or are you making a statement ? 102 METHOD ,0P DIKECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. Smith. I just wanted to call attention to what Mr. Brandeis asked, to show that they were about the same questions that have been asked here. I merely wanted to read that from the book to show you. The question was whether or not you believed tha,t this should be done on a pro rata basis, or whether it should be divided up with the manufacturer. Mr. Kent. I think I said that was a question af agreements I said that the question as to the division of profit was one to be settled by bargaining, and that if the manufacturer was exceedingly anxious to get a big product out, because there was a big profit, and was wilhng to pay more than the regular rate, he might pay $1.50 extra for the extra pair of shoes. If he did not feel that way about it, and thought the profit should be divided, he might say to the man, "I will give 50 cents." Then the man might say he wanted a dollar, and the employer would say, " Well, I guess I will let you have it." Mr. Smith. Mr. Brandeis said his idea was that they should be paid a uniform rate. Mr. Emery. May I call attention to a slight error here? I think that the gentleman has mistaken Mr. Brandeis's inquiry for an opinion. That seems to me to be an inquiry rather than an opinion, and you will notice in the testimony that the witness responds, "That is not exactly it." Now, Mr. Brandeis's language appears on page 43, where he says: It must not be supposed that the introduction of the piece-rate system is scientific management, or even an approach to it. On the contrary, the existence of the piece- rate system often proves the greatest obstacle to the introduction of scientific man- agement. Under scientific management the increase of wage is coincident with reducticn in cost, but under the Erie piece-rate system the increase in wages was attended by reduced performance. Then he asks Mr. Gantt the question, "Is this what you mean?" And the witness responds, "No; that is not exactly it." That is not Mr. Brandeis's conclusion. Mr. Keating. The witness's answer to that question was about as definite as to the other one. Mr. Smith. Are not the Taylor system and your system opposed to piecework ? Mr. Kent. Yes, sir. Mr. Keating. Opposed to piecework? Mr. Kent. "When I made that answer I had in mind the average kind of piece rate, based upon the old-fashioned piece rate. I am opposed to that kind of a piece rate, but a piece rate made after in- vestigation is an altogether different thing, and that I am in favor of. In this book [indicating], which was written two years ago, I stated that I was in total sympathy with labor and said that scientific man^ agement would not be a success unless it took into consideration, as one of the first elements, the satisfaction of the laboring "man and the improvement of his condition. Mr. Denison. Does the scientific method that you have been speaking about in connection with the employment of labor mean an application of the principle of the survival of the fittest ? Mr. Kent. Yes, sir. Mr. Denison. Do you believe in the absolute application of the doctrine of the survival of the fittest ? METHOD OP DIRECTING WOBK OF GOVBIiNMENT EMPLOYEES. 103 - Mr, Kent. With this modification. When you find a man who is unfitted for a particular job, it is the duty of the employer, the city, or the community to find a place for that man. He must not be thrown out to starve. Mr. Denison. Is not that rather a dream ? Mr. Kent. It must be so eventually. It must be what we must . come to. Mr. Denison. Then, in this scientific management, you do apply the doctrine of the survival of the fittest ? Mr. Kent. To that extent; yes, sir. Mr. Denison. If the particular employer does not have a job that he can give the unfit man, the man must be eliminated ? Mr. Kent. I say it is the duty of society Mr. Denison (interrupting). I am not talking about the duty of society. It is your duty under the present system to eliminate him. Mr. Kent. He is bound to eliminate him, because his competitors will force him to do so. Mr. Denison. So that sooner or later other people wiU have to take care of the man who is unfitted for the job ? Mr. Kent. He wiU be able to get a better job, probably. I want the committee to find out what does happen to the man who is thrown out; find out what becomes of him. Get statistics on that. Mr. London. The doctrine of the survival of the fittest, in its apphcation to human society, means something different, in your mind, than the doctrine of the survival of the fittest in the animal world. While in the animal world survival of the fittest means that the animal with the stronger claws and stronger teeth will crush the weaker animal, it does not mean that in society? Mr. Kent. No. The whole progress of civilization is modifying that doctrine of the survival of the fittest so as to ameliorate that condition. Mr. London. It is a complete misapplication to speak of it as if it meant that the weaker must be eliminated from society ? Mr. Kent. It does not mean elnrdnated from society; it means from the particular job for which the man is unfitted. Mr. London. You would promote vocational education ? Mr. Kent. Yes, sir. Mr. London. And old-age pensions, and all sorts of methods that would help every human being to live the life of a man? Let us make this clear. All efficiency methods seek to promote efficiency and increase the productivity of labor; is that right? Mr. Kent. Yes, sir. Mr. London. Mr. Brandeis, who is an advocate of efficiency methods in industries, is also a strong advocate of collective bar- gaining between capital and labor, i^ he not? Mr. Kent. I do not know. Mr. London. Well, I do know. In how many shops or industries have these efficiency methods been introduced ? Mr. Kent. I have not the statistics. I think that Hoxie found 35. If you' briiig the Halsey premium -system in and the time study, I think they run into the thousands. Mr. London. Can you give us some idea as to the proportion of these shops in which the principle of collective bargaimng exists? 104 METHOD OF DIRSOTINQ WOBK. OP GOVBKNMJJWX "EMFCOYEEa. : Mr. Kent. No, sir; I hg,ve never inquired into tha.t. I iave heard that is the. case with the Plimpton Press. Mr. London. In dealing with human heinga, do you think you caa introduce a new method in an industry without consulting the men who will be affected by the new method? In other words, wl^h you deal with human beings and not with machines, don't you. think that in introducing new methods you must consult the wishes of th© people whom the new naethods mil affect? Mr. Kent. Yes, sir. Mr. London. In other words, every eflicjeney system c^alculftted to increase the productivity of the men, in the factory must invfllve the cooperation of the men themselves i Mr. Kent. Yes, sir. Mr, London. And in order to attain the full measure of thja,t cooperation you must give them an opportunity for collective ex* pression of their wishes. Mr. Kent. I don't see that it is at all necessary. I have no objee- tjon to it, but as to laying it down as a principle, I can not go that far. Mr. London. In other words,, you would have the employer deal with each individual separately. Mr. Kent. I think that is preferable, hn% it doe,s not necessarily exclude collective bargaining. Mr. London. Is it preferable ? Mr. Kent. It appears to you to be so. It ig outside the queatioa of a stop watch. Mr. London. Let us see if it is outside. You try to obtain greater productivity on the part of labor. That is the object of efficiency. Mr. Kent. Productivity on the part of capital, machinery, and labor, the whole amount of goods to be distributed to the whole community. Mr. London. Exactly. But .you try to get out of the worker a larger product. Mr. Kent. Yes. Mr. London. In order to obtain a larger product you change the conditions of work. Mr. Kent. Yes; improve tJiem. Mr. London. You improve them. Now in order to obtain these improvements you musttave the good will of the men, must you not? Mr. Kent. Yes. Mr. London. Can you obtain the good will of the men if you sup- press the effort on the part of the worker to organize ? Mr. Kent. I don't understand how Mr. London (interposing). Can you obtain the good will of the laborer if you suppress his effort to organize for mutual benefit? Mr. Kent. The things seem to me so different that I can not see what connection they have with each other. Mr. London. Then the question of Qolleotive bargaining has noth- ing to do with efficiency methods ? Mr. Kent. Not necessarily. Mr. London. You spoke of the introduction of the machine, and the opposition of organized labor in the past to the introduction «"*• Hours worked on premium is 36.67 per cent of the entire working time of all employees of the same class. FOREMAN MACHINIST. DM 2 A. Crawford . 26 7} $1,600.00 $129.72 $18.17 $147.89 METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 151 Premiums earned during month of January, 1916 — Continued. GANG BOSS. No. Name. • Time. Bay rate. Total pay, day rate. Pre- mium. • Total amount paid. Hours of premium time paid for. Hours worked on premium. Aver- age pre- mium per cent earned. DM 4 F. B. Burris O.G. Sthol J. D.Flynn G.H.Jones W. F. Penny H. E.Fisk R.H.Stackliouse. J. F. W. Hedge... Total Ds. hrs. 29 29 29 28 28 7i 4 7i 27 27 6i $100.00 100. 00 100.00 100.00 100.00 100.00 100.00 100.00 $100.00 100.00 100.00 96.67 99.79 19.79 93.33 100.00 $12.56 9.62 5.02 13.96 17.24 11.01 17.33 12.56 $112.56 109. 62 105.02 110.63 117.03 30.80 110.66 112.66 Hrs. Min. Hrs. Min. 6 7 g 10 11 12 15 117.47 TOOLMAKEES. DM. 18 23 C. E.Hunt J. J.Collins do 12 4 21 4 15 6 4 21 25 4 21 4 20 3 18 24 4 ? 4 $3.76- 3.28 3.52 3.68 4.66 4.80 3.52 4.16 3.28- 3.52 3.76 3.28 3. 52 3.62 4.16 3.28 $52.64 16.40 73.92 18.40 68.40 28.80 17.60 87.36 86.28 17.6fl 78.36 16.40 73.70 15.84 74.88 83.64 $2.43 $55.07 6 10 5 40 91.18 23 8.79 99.11 20 21 56 50 3?. 81 24 M.H.Nethercote. do 24 24 do 115.60 12 OO 25 F. S. Atwood do 25 .43 2.50 1Q5. 39 87.78 6 60 6 6 77 50 20 12.20 29 C. J. Tarr 7.89 32 CM. T.Anderson. do 32 6.97 103.53 14 58 104 6 14.38 35 O.A.Erhardt do W. F. Toomy do 36 37 6.99 96.09 14 15 146 6 9.75 37 15.93 • 2.73 106.65 86.37 33 6 31 40 108 36 30 25 30.89 119 E. Swensson Total 18.31 45.77 101 61 553 45 24.49 Premium percentage of sliop=15i^e!H!4lB™^= 18.80 per cent. 553 hours 45 mmutes Hours worked on premium is 19.50 per cent of the entire working time of all employees of the same class. MACHINIST. 31 G. F. Lincoln 25 3.04 $79.04 $2.19 $81.23 5 46 90 5 6.40 33 M. B.Hassett 25 3.28 85.28 26.02 110.30 61 2 198 50 30.70 34 G. H.Rayne W. J. oSaek 22 Tl 3.04 72.68 3.48 76.16 9 9 27 60 32.88 38 26 n 3.28 85.28 32.86 118. 14 80 9 194 10 41.28 J. DriscoU do 12 IS 39 21 3.76 78.96 20.06 99.02 42 41 189 6 . 29.03 41 T. J. Sheehan 4 3.52 17.60 41 do 21 n 3.76 78.96 33.95 130. 61 73 14 190 5 38.53 42 H. W. Carlson 4 n 3.28 16.40 42 do 21 25 n 3.52 3.04 73.92 79.04 26.78 .11 116. 10 79.15 58 36 18 169 50 10 50 34.64 43 W.H.Ash .,69 44 H.D. Roberts.... 23 3* 3.04 77.52 7.64 85.16 20 7 136 55 14.69 46 C. Hellqulst P.C.lfiGinnis... 24 3.28 82.00 17.68 99.68 43 8 120 50 36.70 47 25 3.52 91.62 13.68 106.20 31 6 205 6b 15.10 48 D. F. Mannbc 22 n 3.04 76.24 7.85 83.09 20 39 171 40 12.03 49 B.S.Ford , 26 3.28 85.28 12.67 97.95 30 64 225 20 13.71 60 E. A. Petterson .. 4 n 3.62 17.60 60 do.; 21 ■a, 3.76 3.04 78.96 79.04 35.95 7.46 132.51 86.50 76 19 30 38 210 101 20 30 36.37 51 C. I>. Gendron 19.34 52 M. G. Cunning- ham 24 24 3.28 3.04 82.00 79.04 16.41 .13 98.41 79.17 40 2 20 169 1 45 55 23.58 S3 W.S.Clarke 17.39 54 A. E. Magnuson.. 25 3.28 86.28 18.14 103.42 44 14 181 36 24.36 55 S. E. Beck 25 n 2.80 72.80 8.18 80.98 23 22 174 15 13.41 57 J. F. McCarthy... 23 u 2.80 69.83 .83 70.66 2 22 8 25 28.12 69 0. Borgstrom A. LeRoy...:... 24 3.28 82.00 30.05 112.05 73 18 245 25 29.87 61 22 3 3.28 84.87 8.67 93.64 21 9 210 66 16.03 63 P.Drew 26 3.04 79.04 12.75 91.79 33 34. 181 6 18.54 152 METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. Premiums earned during month of January, 1916 — Continued. MACHINIST^Continued. No. lOff 101 102 102 104 105 105 106 107 107 108 108 109 111 111 113 114 115 116 117 118 120 120 121 122 123 123 124 124 125 125 128 130 131 Name. C. E. Barlow. do J. A. Forrest. do J. J. Henry... F. A. Holwav S. G. Halberg J. W. McDonald.. A. F. Nutting V. Swenson.. . do N.G.Gould.. C. J. Mumane do A.H.Dili.... E. J. Fagan... F. A. Nugent., R. Smith T. Wlxitworth.... C.J. Frechette.... O. Cheney E. J. Waterman. . L. Anderson J. J. Coughlin do P. Gaffney E. M. Burns do E. L. Barlcer M. F. Cheevers. .. F. B.Hardy E. Jones P.T.Hughes W.P.Cross J. P. Larkiu G. W. Stiart A. M. Fillebrown. .-..do J. V. N. Beeman.. O. M. Whittier... W. Barker do H. C. Orr E. Puhpal do C. G. Lindstrom.. W.H. Mullen.... do T. F. Mulrean... do G. F. Glidden . F. L. Hapworth.. — do T.Conrad H. A. Brown W.W.Carter A. Kartz H. E. West O. B. Schirmer... F. J. Christensen.. ....do P.J. Kelliher E. T. Roby J. A. MacKean . . . do J. J. Mitchell ....do T.H. Chafle ....do T. E. Farrell B. L. Scherer..... E. A. Hanson Time. Ds. 4 21 4 21 23 24 23 21 25 4 7 26 2 21 25 25 25 23 24 7 22 7 24 4 20 24 4 21 25 26 25 23 25 25 25 25 2 19 24 23 4 21 18 4 ,21 24 4 21 4 21 23 4 20 24 22 14 25 23 23 4 20 25 25 4 21 Day rate. S3. 52 3.76 3.28 3.52 3.28 3.28 3.52 3.04 3.04 3.28 3.52 3. .52 3.28 3.52 3.04 2.80 3.04 3.28 3.04 3.04 3.28 3.52 3.04 3.04 3.28 , 2.80 3.28 3.52 3.28 3.04 3.04 3.28 3.04 3.04 3.04 3.04 3.28 3.52 3.04 3.04 3.52 3.76 3.04 L3.04 3.28 3.28 3.04 3.28 3.04 3.28 3.28 3.28 3.52 3.04 3.04 3.04 3.04 3.28 3.28 3.04 3.28 3.04 2.56 3.52 3.76 3.28 3.52 3.04 3.28 3.28 3.04 3.28 Total pay, day rate. S17. 60 78.96 16.40 73.92 78.72 84.26 90.64 69.92 79.04 16.40 28.84 91.52 16.40 73.92 79.04 72.80 79.04 80.36 78.66 24.32 75.44 28.16 78.47 15.20 68.88 71.75 16.40 73.92 85.28 79.04 79.04 82.00 79.04 79.04 79.04 79.05 13.12 68.64 77.90 78.47 17.60 7&96 75.43 15.20 68.88 84.67 15.20 68.88 15.20 68.88 85.28 16.40 72.16 77.43 79.04 78.66 79.04 80.36 80.87 15.20 68.68 79.04 66.56 17.60 78.96 13.12 55.33 13.02 68.27 84.87 78.66 78.72 Pre- mium. $41. 00 17.09 20.77 14.63 21.40 14.21 .18 8.55 6.65 35.66 28.04 4.95 19.29 20.27 14.04 .65 16.07 7.51 8.11 8.92 13.03 19.67 9.36 8.12 30.76 9.18 26.21 9.83 7.66 24.50 14.96 5.43 2.04 22.38 4.10 22.62 7.15 13.01 .19 11.70 6.40 8.47 6.49 25.40 2.10 15.03 10.18 11.23 3.40 32.40 is.os' 18.71 11.23 14.62 12.01 Total amount paid. S137. 56 107. 41 99.49 98.79 112.04 84.13 79.22 bl. 79 97.17 125. 88 107. 08 77.75 98.33 100.63 92.70 24.97 91.51 35.67 86.58 93.00 84.78 109. 99 94.64 87.16 109.79 91.18 105.25 88.87 86.70 103.64 Hours of premium time paid for. Hrs. Min. 88 34 38 50 no 40 35 26 48 38 37 24 19 52 12 61 SO 49 73 48 14 9 50 46 49 26 36 67 1 43 39 12 17 4 21 20 21 51 37 14 96.72 83.33 80.61 118. 94 79.53 108. 60 91.82 102. 87 97.09 85.47 100.26 83.83 87.61 85.16 104. 44 82.46 96.90 94.06 90.27 128. 96 " '86." so' 100.00 96.10 93.18 90.73 45 2 22 50 21 22 80 66 22 24 68 59 25 52 20 9 64 28 Hours worked on premium Srs. Min. 153 00 177 10 192 40 244 20 143 20 204 25 57 15 48 40 181 40 196 65 191 40 193 45 175 30 199 00 66 50 164 36 60 20 144 40 Aver- age pre- mium per cent earned. 168 30 194 10 34 39 14 17 5 23 47 37 10 48 56 43 17 27 32 14 28 26 56 16 50 22 17 17 5 56 60 S 8 25 2 29 34 ID 38 70 62 a 12 46 '3 27 24 38 13 29 18 267 36 30 35 131 5 227 40 167 00 195 20 99 25 154 40 189 25 154 5 101 26 16 20 161 16 65 55 265 20 138 00 "156 30 144 10 5 20 136 20 56 127 87 30 144 00 114 35 162 20 118 55 182 30 167 20 157 15 i44 20 is? "s 154 50 199 .. 82 35 39.88 25.38 28.60 18.39 19.90 26.09 .23 34.70 26.40 44.49 37.48 7.38 26.20 28.17 18.57 3.07 26.36 28.29 15.84 13.79 19.18 16.83 74.66 16.30 35.64 13.41 35.32 26.02 13.03 24.03 22.49 14.08 32.96 29.53 16.38 21.38 12.64 29.50 22.36 8.75 19.76 30.01 17.63 19.62 46.41 4.47 22.58 21.05 16.20 6.35 '4S."67 "28.' 55 "24." 6i 17.70 19.20 36.48 METHOD OF DIBECTING WOBK OP GOVERNMENT EMPLOYEES. 153 Premiums earned during month of January, 1916 — Continued. MACHINIST— Continued. Name. Time. Day rate. Total pay, day rate. Pre- mium. Total amount paid. Hours of premium time paid for. Hours worked on premium. Aver- age pre- mium per cent earned. E. Hess T. r. McGowan.. T. V. AuCoin.... M. J. Costigau A. M. Stirlmg.... D. C. Moreland... P. W. O'Donnell. do D. Friberg N. E. Pamell A. S. Pearce C.F.Carlson do C. E. Norrby J.McFarland do W.C. Fisher M.J. O'Brien I.S. Pearson P. L. I^acey F.A.Suhre G. W. Greenwood. ...do E.T.Lorrey — do A. A. Authier J.T.Brown E.F.Smith B.C. Button W.J.Blake G. J. Frykman P.J.O'Neal J. D. Began W. Edwards J. Hughes P. W. Clausen.... A. Andreeu... M. W. Bowen. W. R. Connell F. "W. Eattek E. Hanf do E. F. Delaney.. G.H.Major.... P. J.Conrad E. D. Farley... F. O. Franson.. J. C. Dieselman. T. H. C. Hansen do — . — . Sylvia G. A. Bjorn A. F. Almquist... J. J. Hayden J.W.Herbert..;. J. W. Dimond.... D. J. Eoche C. E. Gullbrand.. A. Greenwold W. S.Jordan W. G.Kennison. . S. C. Breese do J. Durb E. W. Lindqulst . . M. J. O'Halloran.. E.A.WiUey M.Kelly C. P. Roche J. C. Albrecht, jr. J. S. Jostedt I Ds. lira. 24 7i 24 I 25 25 9 li 10 4 21 24 7 25 24 3i 3 6i 20 7i 25 4 21 22 5 15 4 25 12 13 10 IJ 26 2^ 25 5 20 1 25 is 18 26 22 5J 22 4 21 24 2 22 6J 23 4 24 n 24 4 21 12 25 22 3i 25 24 3 23 7 20 24 6 26 26 25 4 20 7i 24 7i 25 19 21 3j 21 25 23 24 7i 3.04 3.04 3.04 2.80 3.04 3.04 3.04 3.28 3.04 3.04 3.28 3.28 3.52 3.04 3.04 3. 28 3.04 3.04 3.04 2.80 3.04 3.28 3.52 3.04 3.28 3.04 3.04 2.66 3.04 3.28 3.04 3.04 2.80 3.04 3.04 3.04 3.04 3.04 3.04 3.04 3.28 3.62 3.04 3.28 2.80 3.04 3.04 2.66 2.80 3.04 3.28 2.80 3.28 3.04 2.80 3.04 3.28 3.04 3.04 3.04 3.04 3.04 3.04 3.28 3.04 3.28 3.04 3.04 2.66 2.80 2.80 3.28 78.85 78.47 79.04 72.80 31.98 79.04 15.20 68.88 78.66 79.04 85.08 15.79 73.70 79.m 15.20 68.88 71.82 60.16 79.04 37.80 20.14 16.40 72.16 16.20 68.06 39.52 41.20 66.56 79.04 85.28 18.24 64.22 72.80 57.76 57.76 79.04 77.52 79.04 72.01 79.04 16.40 73.92 79.04 81.39 70.00 78.86 79.04 52.16 70.00 15.20 68.88 36.40 85.28 68.21 72.80 77.14 81.50 63.84 79.04 79.04 79.04 79.04 15.20 68.68 78.85 85.28 66.88 70.49 68.24 72.80 72.80 85.08 22.43 21.89 21.17 16.39 .38 2.27 35.43 10.78 26.81 13.16 18.32 16.73 13.96 9.37 11.70 .73 2.65 23.67 12.11 .06 .08 13.27 17.72 22.71 4.81 20.66 21.93 3.67 8.37 15.00 10.27 .49 21.79 12.44 22.93 6.33 .24 14.38 23.33 20.60 8.06 15.15 14.45 11.37 5.47 2.48 23.38 18.37 29.33 10.93 8.80 16.22 10.26 21.76 22. 70 25. 16 27. 04 12.51 10.14 14.25 22.08 9.92 28.78 101.28 100.36 100.21 89.19 32.36 81.31 119.51 89.44 112.43 111.89 Hts. Min. 69 1 57 37 65 43 46 50 1 .. 87 32 28 22 87 53 65 24 Hrs. Min. 199 30 196 30 187 .. 192 5 46 50 62 35 200 'S 71 5 199 45 191 15 102. 65 97.36 30 24 48 13 156 16 195 35 100. 81 85.77 69.53 90.74 38.53 22.79 112.23 95.37 39.58 41.28 79.83 96.76 107.99 23.05 84.88 94.73 61.43 66.13 94.04 87.79 79.53 93.80 91.48 113.25 85.37 81.63 84.38 102. 18 99.64 60.22 86.15 98.53 47.77 90.75 70.69 96.18 95.51 110. 92 74.77 87.84 96.26 89.30 100. 80 106. 58 104. 01 112.32 79.39 80.63 72.49 94.88 82.72 113.86 41 1 36 43 24 40 30 48 2 6 6 59 169 15 165 35 118 195 6 5 00 36 40 66 41 194 29 69 10 13 41 28 46 38 55 23 12 40 54 22 62 39 9 40 22 2 39 29 27 1 1 18 57 21 32 44 160 55 32 15 52 3'0 189 5 173 5o 1/57 00 40 00 154 50 188 20 27 20 193 00 129 15 99 30 13 50 177 00 99 20 54 6 16 39 36 41 5 61 24 54 12 25 11 3 18 228 10 140 25 67 50 186 25 192 60 164 20 130 20 171 15 38 1 32 30 13 20 6 32 66 48 48 20 71 33 28 46 23 10 42 41 27 .. 57 16 168 20 30 66 103 200 00 175 40 156 55 128 20 62 30 208 15 196 15 226 55 57 25 66 13 65 58 32 56 26 42 44 32 63 5 28 20 70 12 184 60 199 30 156 15 128 35 99 40 113 35 200 00 164 50 29.58 29.47 29.80 24.38 2.14 9.53 '43." 75 39.90 44.00 34.20 19.58 24.65 24.23 22.17 20.89 15.79 2.19 19.05 29.22 18.63 .52 .41 2U83 26.83 3.6.28 31.67 36.11 33.27 35.37 11.42 30.55 27.15 9.40 32.40 32.95 23.71 11.86 22.04 31.84 19.32 25.28 22.58 34.76 20.18 6.33 33.40 27.51 45.60 22.42 37.07 20.50 13.76 26.24 31.06 33. 19 42.22 25.61 26.79 39.01 31.54 17.19 35.09 154 METHOD OF DIBECTIlirG WORK OF GOVEKWMENT EMPLOYEES. Premiums earned during month of January, 1916 — Continued. MACHINIST -Continued. No. Name. Time. Day rate. Total pay, day rate. Pre- mium. Total amount paid. Hours oi premium time paid for. Hours worked on premium. Aver- age pro- per cent earned. 316 318 329 331 333 348 C. A. Sherwin H. H, Hermanson. H.H.Beaton A. Kanaan A. E. Peokham.... F. Hohworth do Ds. Ins. 24 i 17 6 23 18 7i 25 4 20 7i 26 22 5J 24 7 22 22 3 7i 14 4 13 19 24 6i 3.04 3.04 2.80 3.04 2.80 3.04 3.28 3.04 3.04 2.80 3.04 3.04 3.04 3.28 2.80 3.04 3.04 79.04 79.04 72.80 78.85 72.80 16.20 68.68 79.04 72.01 72.45 79.04 69.92 15.01 68.88 39.20 63.84 78.47 27.95 17.57 5.92- 12.93 12.11 105. 99 96.61 78.72 91.78 84.91 Hrs. Min 73 33 46 15 16 56 34 2 34 37 Hrs. Min. 158 10 136 00 57 45 144 65 147 00 46.50 34.01 29.32 23.48 23.55 348 15.90 2.74 1.07 17.91 13.63 6.60 99.78 81.78 73.08 90.36 92.67 76.42 39 14 7 13 2 49 51 10 36 52 17 6 164 45 68 45 102 40 170 2 160 5 187 45 23.81 353 354 358 359 361 366 J. T. Wallis L.E.Allen I.E. Killion J. J. J. Conneamey M. J. Lyons A. Gohr 12.38 2.74 30.04 22.40 9.11 366 do 16.64 99.63 39.20 63.84 78.47 38 37 143 45 77 20 6 60 41 19 26.86 62 P. H. Connell J. A. Dirwanger.. H. J.Wliite Total 152 156 2,222.79 5,619 37 22,718 40 23.76 Premium percentage of shop: 5 ,619 hours 37 minutes „j "22,718 hours 40 minutes"'''''* P™ ''™'- Hours worked on premium is 67. 13 per cent of the entire working time of all employees of the same class MACHINIST'S HELPER. DM 214 216 228 229 232 233 235 252 266 258 259 263 270 276 277 292 298 299 304 309 322 332 335 340 342 360 365 369 370 M. Egan G. L. Veno T. F. Kelly W. F. Scherrer . . . E. P. Davis P.Kelly J. T. Lovely E. Colligan M. J. Clancy T. Cunningham. . C. J. Davis P.Ward W. F. Burke B. F. Lord J. A. Feeley E. F. Malloy A. T. Leonard J. Mulhem J. J. Gahan J. H. Pomfrey B. W. Griffin J. Hehir E.J.Williams.... E. L. Eadie W.P.Gill W. L. Greene J. Blood J. E. Leighton J. J. Murphy Total. 24 15 7i 25 24 7| 24 25 23 25 19 26 23 4 25 22 5 24 7 23 4 20 6} 24 25 22 24 5 23 5 24 6 24 6 25 25 24 4 $2.00 2.24 2.00 2.00 2.40 2.40 2.40 2.00 2.24 2.00 2.00 2.00 2.24 2.24 2.00 2.40 2.00 2.24 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.24 S50.00 36.70 62.00 51.94 60.00 62.40 57.60 52.00 44.80 52.00 60.00 52.00 62.92 57.96 49.50 52.28 50.00 58.24 46.00 51.25 50.00 10.00 51.50 46.25 52.00 52.00 52.00 52.00 57.12 83.10 .50 14.66 .89 3.40 8.14 1.55 .83 5.50 10.13 8.66 5.11 13.49 .06 3.98 4.64 6.87 2.35 3.78 10.84 6.43 .25 3.06 7.40 .95 1.65 11.63 4.98 144.72 $63.10 36.20 66.55 62.83 63.40 70.54 59.15 62.83 50.30 62.13 58.66 67.11 66.41 58.02 53.48 56.92 56.87 60.59 49.78 62.09 56.43 10.26 54.56 53.65 62.92 53.65 63.63 56.98 57.12 1 47 58 12 3 33 11 20 27 8 5 9 3 18 19 39 40 31 34 39 20 26 48 10 13 15 56 15 28 27 28 8 24 15 7 43 21 25 43 1 1 12 15 29 37 3 49 6 35 46 30 19 54 667 38 34 98 55 139 25 22 55 174 56 66 40 55 35 20 71 50 157 15 132 30 98 9 132 55 122 40 53 19 85 10 128 35 90 30 48 45 127 HI 2 52 40 S8 SO 14 55 17 190 37 14 2,324 50 36.52 1.80 41.79 15.49 6.48 40.70 9.36 9.34 27.36 25.77 26.15 35.18 36.24 29.92 18.16 2L36 16.63 31.01 34.11 23.13 36.97 23.26 33.34 25.69 ,37.62 34.44 53.78 Ti . .. . ._ 557 hours 38 minutes Premium percentage of ^ov^^^^^^^^^^^^^^.^.9f» per cent. Hours worked on premium is 16.68 per cent of the^ntire working time of all employees of the same class METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. 155 Premiums earned during month of January, 1916 — Continued. CORE MAKER. No, Name. Time. Day rate. Total pay, day rate. Pre- mium. Total amount paid. Hours of premium time paid tor. Hours worked on premium. Aver- age pre- mium per cent earned. DF 76 J.J. Sullivan Bs. llTS. 24 6i - J3.52 $91.52 S9.93 tlOl.45 Hn. Mm. 22 34 Hrs. Min. 47 45 47.26 Premium percentage of shop=47.26 per cent. Hours worked on premium is 24.06 per cent of the entire working time of all employees of the same class. SCREW MAKER. DM 159 P. J. Matony., $2.80 $72. 80 $11.28 $84.08 19.03 Premium percentage of shop= 19.03 per cent. Hours worked on premium is 86.44 per cent of the entire working time of all employees of the same class. MACHINE APPRENTICE. DM 166 A. F. Franz. 21 4i $1.92 $43.32 $5.84 $49. 16 24 21 16.39 Premium percentage of shop= 16.39 per cent. Hours worked on premium is 10.08 per cent of the entire working time of all employees of the same class. TOOL GRINDER. DM 249 E. Sherman. 24 7i $2.24 $58. 10 $13. 89 $73. 99 56 44 45.24 Premium percentage of shop =45.24 per cent. Hours "Worked on premium is 62.87 per cent of the entire working time of all employees of the same class. TOOLSMITH. DS 38 S. Mallet. 24 $3.28 $82. 00 $8.50 390. 50 20 44 21.60 Premium percentage of shop =21.60 per cent. Hours worked on premium is 50 per cent of the entire working time of all employees of the same class. STEAM HAMMER DRIVER. DS 42 J. Shea. $2.24 $58.24 $3.80 $62.04 13 35 26.63 Premium percentage of shop =26.63 per cent. Hours worked on premium is 25.50 per cent of the entire working time of all employees of the same class . BLACKSMITH. DS 3 7 M. T. Glyim J. W. Winch T.Coleman J. Houliahan 0. L. Loientzson. Total - 25 25 25 19 23 $3.52 3.04 3.28 3.04 3.04 $91.52 79.04 85.28 60.80 72.96 $12.36 $103.88 79.04 93.87 64.78 92.92 28 5 43 50 8 35 137 55 32 40 166 .. 64.07 6 9 13 8.69 3.98 19.96 20 58 10 28 52 31 15.20 32.04 31.64 44.89 112 2 389 .. 28.59 Premium percentage of shop= "^ '^ggo" p "g^"*^ =28.80 per cent. Hours worked on premium is 34.36 per cent of the entire working time of all employees of the same class. 156 METHOD OF DIRECTING WORK OE GOVERNMENT EMPLOYEES. Premiums earned during month of January, 1916 — Continued. BLACKSMITH HELPER. No. Name. Time. Day rate. Total pay. day rate. Pre- mium. Total amount paid. Hours of premium time paid for. Hours worked on premium. Aver- age pre- mium per cent earned. DS 22 23 24 25 P. DiLuzio J. Kendall E. A. MoDonough Ds. lira. 24 19 23 25 22 3i 22 25 25 t2.16 2.16 2.16 2.16 2.16 2.16 2.16 2.16 J56.16 43.20 51.84 56.16 62.31 54.00 56.16 56.16 $14.18 3.60 2.21 2.42 5.54 5.27 1.72 .90 170.34 46.80 54.05 58.58 57.85 59.27 57.88 67.06 Hn. Min. 52 32 13 19 8 12 8 58 20 30 19 32 6 23 3 20 Hrs. Min. 166 00 96 00 26 45 49 45 71 10 48 20 24 15 11 00 31.65 13.87 30.65 18.02 29 J. Hart 28.80 34 36 40 T. Mulholland.... W. J. Petipas M. J. O'Brien 40.41 26.32 30.30 35.84 132 46 493 15 27.50 T, . i < 1, 132 hours 46 minutes ,„ „, „„ „.„i Premium percentage of €iyov=.^^-—^^^^^~26.92 per cent. Hours worked on premium is 26.39 per cent of the entire working time of all employees of the same clas s. PAINTER. DW 74 78 H. A. Gildersleeve J. F. Mallanaphy. 15 25 S2.88 2.72 $61.56 70.72 $0.19 .78 $61.75 71.50 31 2 17 4 09 17 25 12.92 13.11 .97 2 48 21 25 13.02 Premium percentage of shop-, 21^^^^=13.07 per c Hours worked on premium is 6.69 per cent of the entire workir CARPENTER. ent. ig time of ill employe 3s of the same class DW 52 58 69 67 J. Connelly J.J. Ryan........ E. A. Carlsson.... J. G.Tomgren... Total 25 25 26 25 $3.28 3.28 3.04 2.80 $85.28 85.28 79.04 72.80 $3.38 26.58 36.39 29.90 $88.66 110.86 115.43 102. 70 8 15 62 24 95 46 86 26 18 5 223 60 215 40 235 60 45.62 27.88 44.40 36.23 95.25 261 61 693 25 38.53 PrOT ninm TiprAfintdtTfi nf oil ATI- 51 hours 51 minutes — 36.32 n vt cent. Hours worked on premium is 38.89 per cent of the entire working time of all employees of the same class. MASON HELPER. DW 79 J. McLaughlin 25 $2.40 $62.40 $9.72 $72.12 32 23 39 45 81.47 Premium percentage of shop equals 81.47 per cent. Hours worked on premium is 19.87 per cent of the entire working time of all employees of the same class. MACHINE OPERATORS. DM 351 A. Frazer.. 9 7 $2.56 $25.28 $26.28 58 25 Hours worked on premium is 63.15 per cent of the entire working time of all employees of same class. METHOD OF DIBECTING WORK OF GOVERNMENT EMPLOYEES. 157 Piecework earned during month of January, 1916. No. Name. Time. Day rate. Piecework. Total. amount paid. AY S TEAM8TEBS. P. Magulre M. i:arraher P. J. Campbell SEILLED LABOBEB. P.I, Nopfle..,,,-', Total Ds. Urs. 10 SA 23 H 20 4 20 71 $2.24 2.00 2.24 2.56 2 trlpsr at W.'49 per trip equalsi. . 82. 98 $5.22 11 1 trip, at Jli35 pef tripequals 11. 35 1 trip, at ll'.lftper trip equals, 1. 16 1 trip, at $1.33 pet-trip isquals 1.33 ?1l' 19 28 2 triTO^at $1.28 per trip equals $2. 56 2 trips, at 11.49 per trip equals 2. 98 6 trips, at $1.71 per trip equals-. 8. 55 14 Off 24.64 Tot^l preii;iiui;njequals $3,314.80. Total Hours worked on premium is 41.24 per cent of the total time worked by all shops. Watbrtown ABSENAIi, Watertown, Mfiss., March 10, 191S. From : Commanding Officer. To : Chief of Ordnance. Subject : Premiums earned during January, 1916. 1. Inclosed lierewith, in duplicate, is statement of premiums earned at this arsenal during the month of January, 1916. C. B. Whejeleb, Colonel, Ordnance Department, Mr. Bkowne. Do you run diay and night shifts, General? Gen. Geozier. Night shifts now only on the big tools, such as the large boring mills. Not to weary you with too much detail as to the experience of the Ordnance Department in the seven years dur- ing which M'e have been installing and practicing this system of scientific management, I will tell you that a good deal of our ex- perience is set forth in Senate Document No. 800 of the last session of Congress — ^the Sixty-third Congress, third session; and if any- one should be interested in looMng. at that document, I would sug- gest that he would read first pages 2 and 3, inclusive, which cover the reasons for the existence of the document ; that he would then read from page 33 to 60, inclusive, which give extracts from my annual reports for various years, commencing with the year 1907, which extracts state the experience of the Ordnance Department, giving an account of our experience and some of the incidents of the practice of this system. I would suggest that he next turn to page 13 and read pages 13 to 32, inclusive, which are iastructive pages, in that they give reprints of certain petitions signed by em- ployees of the arsenal, rather numerously, against the continuance of the system, mention a number of complaints in regard to it, and give also my own answers to those complaints. Those petitions, statements of complaint, and the answers to them, I think, are quite instructive; and nobody can really understand this subject unless he understands what is in those papers and the others that are 158 Mia HOD OF DIEECTING WORK OF GOVEBJNMEl^T EMPLOYEES. quoted here. Then the reader can proceed to the final pages of the pamphlet,, commencing with page 61, and read what is stated in my last report, the report for 1914, at least, which finishes out that pamphlet. I can say now that the charges that have been made against the system as we employ it group themselves under two general classes. One class comprises complaints that some have an opportunity to earn premiums under this system and that other men do not have the opportunity. I am willing to state that it would be desirable that all men should have an opportunity to earn premiums and that we are doing our best to give the opportunity to all men and that we are continually increasing the percentage of the work which is done under the premium system. I would like to draw your atten- tion to the fact that that complaint is a complaint, not of the system, but of the absence of it. It is a complaint that it does not go far enough ; that the benefits are not extended to enough people. There is no statement, however, in the complaint that those who do not get the advantage of working under the premium system are at any disadvantage compared with their own previous state. There is no ' complaint that their wages are reduced or that the opportunities for earnings are reduced. Such complaint could not be supported by the facts, and it is not made. And next perhaps, as analogous to that complaint, there is one that the high-grade men are not given an opportunity to earn premiums under this system, that it is par- ticularly a system for the advance of the low-grade worker, the man in the nature of a machine operator. I wish to state to you that that complaint is also entirely out of accord with the fact. The fact is just the other way, as far as our experience has gone in the Ord- nance Department and as exemplified at the Watertown Arsenal. You will see from this document to which I have called attention that to those one or two complaints there stated the answer is given in figures. The substance of the answer is that the proportion of the high-grade men, the actual number and the proportion of them who receive the benefit of the premium system, is greater than that of the lower-grade men. In other words, the highest-grade men are benefited the most by the system as we have practiced it at the Watertown Arsenal. I wish to add here that until this system came along we had no method, and, as far as I know, industry in general had no method, for giving these high-grade employees, who are not pieceworkers, or very rarely pieceworkers, an opportunity to increase their wages by output, as pieceworkers are ordinarily given the opportunity to increase their wages by their output. You are all familiar with the fact that many pieceworkers are either unskilled workmen or are skilled in only one particular line and operate machines which are oftentimes partially automatic and that they become very skillful in their own line and can turn out large amounts of work. And those men secure for themselves the same wages as much higher- class employees are able to earn at straight daywork. It is not at all uncommon for a pieceworker to make $3.50 a day at piecework, and it is not at all uncommon to find high-class. machinists at day- work that will make only $3.50, or receive only $3.50 a day. Now, we give to these high-class machinists an opportunity, by means of time study and the premium system, to increase their pay at some- METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 159 thing like the ratio that the man of less skill increases his. I will state to the committee that this method of scientific management constitutes the first instance in which |jjie high-grade worker is let in to a share in the advantages which come from better methods of production. The other general charge that is made against the system is that under it men are overworked. It is all very well, it is claimed, to give men higher pay, but high pay is not worth what it costs if it wears a man out. And it is charged in general terms that our system overworks a man. That charge is almost entirely unaccompanied, as far as the Government establishment is concerned, with any speci- fications. Every time there has been anything like an instance of alleged overwork I have investigated it. We have never found a man at the Watertown Arsenal who has said that he was overworked. We have found one or two cases when some men have thought that other men have been overworked; but in such cases we' have found that the other men would vigorously deny it. In another case, where complaint was made of overworking, a man who was called upon to operate several machines, I investigated it and discovered, as is usually the case in operating machines, that the man during the ma- jority of the time had nothing to do but stand and watch his ma- chines do the work; that his own efforts were called upon only dur- ing a very small proportion of his time, and even then those efforts were not strenuous. In regard to the charge of overwork it is diffi- cult to see how a conclusion can be arrived at without an investiga- tion of the establishment on the spot. I have tried my best to have an investigation of our proceedings made at the Watertown Arsenal. In 1911 the House of Eepresentatives appointed a special committee which went up to the Watertown Arsenal and made an investigation, largely by an examination of witnesses. They did a minimum amount of investigation by observation in the shops. The system was then new and they found a good many men who said that they did not think that they would like it. Most of their complaints were at that time based upon apprehension, because the system was too new to have had experience with it. As a result of this investiga- tion, that committee did not condemn anything that it stated it found at the Watertown Arsenal. It mentioned a good many represensible practices which it stated should not be. indulged in, but it did not find and it not not say it had found any of those practices at the Watertown Arsenal. It ended by recommending that there should be no legislation on the subject. I afterwards thought that I saw an opportunity for an investiga- tion when Congress created the Federal Commission on Industrial Eelations, and I asked the Secretary of War to request that commis- sion to make an investigation at the Watertown Arsenal, and to re- port its conclusion therefrom with its recommendations. The comi- mission did not investigate the Watertown Arsenal. However, it employed a committee, of which Prof. Hoxie, of Chicago, was chair- man, and of which Mr. Valentine and Mr. Frey were members, which committee made a very thorough investigation of the Watertown Arsenal. But it made no report of the results of its investigation of that establishment, and did not state whether it found any prac- tices up there which should not be indulged in, or whether it found a meritorious state of affairs. It stated nothing about the Water- 160 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. town Arsenal. I was informed by Prof. Hoxie that his committee received no instructions upon that subject and had not any intima- tion that it should make a report upon the Watertown Arsenal, after its investigation. * So that i have not been able to secure, so far, the result of a re- port, on the Watertown Arsenal, except the one made by the House of Representatives in 1911, which recommended that there should be no le^slation, I have no doubt that many of the statements that are made to your, committee and many of the statements that are mad«, on the floor of Congress, in both Houses, are believed. I can say to you that niany of them are entirely unworthy of belief, be- cause they are absolutely incorrecti, and oftentimes absolutely un- true. When the legislation along the lines of this bill was added ta the Army bill last year, the proponents of the amendment to the bill which carried the legislation made a speech in defense of it — Mr. Deitrick. Mr. Deitrick made the same misstatement in regard^ to the task time which is made in the preamble to this bill. He said that an attempt was made by the use of the stop watch to get the shortest time in which the best workman can perform a given piece of work, etc., and by this means to get the task time for the job. Then he makes a statement which is true, that two'thirds of the. task time is then added, and that this gives the time for the job. Later on he states that the man must work faster and for this faster work the Government allows him a premium, based on the number of minutes he saves within the task time. This premium is in addi- tion to his regular wages. Now, there is a misstatement-— I do not wish to be understood as stating any statement I have just read of Mr. Deitrick's was a misstatement. They are true down to this point, except the statement that you get the shortest time in which the best workman can perform a piece of work. We do not make an effort to get the best workman ; we are satisfied with any good work- man. But when he says the Government allows him a premium conditioned on the number of minutes he save within the ]ob time, the job time being determined as he says it is determined here, he is inaccurate ; although I doubt not he is unintentionally so. A very substantial premium of 33^ per cent is given him for reaching that job time. Now, understand that job time is obtained by timing a good workman, and seeing the time in which he can do the work, the shortest time if you like, and then adding to that two-thirds, and that is the time taken then as the task time. Then in order to get the time for coming within which a man will commence to get a premium, two-thirds of that is added again, and that second two- thirds Mr Deitrick does not mention. He says he is given a premium for everything he saves within the task time obtained by adding only two-thirds to the shortest time in which it is ascertained a man can do the work. Mr. Smith. Do I understand if a man can do a piece of work in a day, as ascertained by this investigation, that you add two-thirds to that time within which to do a piece of work? Gen. Croziee. We add two-thirds to that time before we reach the time within which we commence to pay him a premium to do this. Mr. Browne. Just take a concrete statement of that number of hours figured out. METHOD OF ElliiEeTING WORK OF GOVERNMENT EMPLOYEES. 161 Gen. Ceozier. All right ; I will give you a statement. Suppbse it is ascertained by this timing process that the shortest time in which a ^obd workman can do a piece of work is ah hour dnd a half. Twb- thirds of that time, of an hoiir, is then added to that time, which gives two and a half hours for doihg that piece of work. Now, that is regarded as the standard tiine or the task time. If he does that ' piece of work Withiii two arid a half houts he gets 33^ per cent inefease cff his pay; Theri, again, two-thirds is added to that. Taking two-thirds of two hours and a half The Chairman. Would make 250 minutes. You started with 90 minutes and added two-thirdsj which makes 150 nainutes, and then two-thirds of that added will make 250 minutes. Gen. CeOzier. Yes; 250 minutes. Now, then, for every minute he comes within 250 minuties Mr. Denison. It is 150. Gen. Crozier. No ; 250 minutes. We staf ted in with 90, added 60, which makes 150, arid two-thirds of 160 is 100; an& add that and it makes 250. Now, for every minute he conies within 250 minutes he is paid extra for half a minute of time; and that rule^-you will see by following it orit — will give him 381 per cent of his pay, if he makes the time of 150 minutes, and not 90 minutes, which is set down as the quickest time in which he can do the work. That is the rule that is followed. The second two-thirds which is added there is in- variable. The first two-thirds, namely, the allowance over the short- est time in which it is found a man can do the work, is not invariable ;^ but there is a substantial allowance which oftentimes reaches two-' thirds. Another statement which Mr. Deitrick makes and to which I have already alluded: He says this system increases the possibility of serious, if not fatal, injuries to the workman. That is directly at variance with the facts as ascertained and reported. He gives an instance in which he says — I will quote him : Only last October a painter was killed while trying to earn a few extra cents as premium held out to him by the management as an inducement to hurry with his work. I happen to know all about that incident, because I was more or less accidentally present at the arsenal when it occurred and saw the man immediately after. The man was working on a premium job, but there is nothing whatever to connect that fact with the accident. That is a gratuitous statement, not being founded upon anything whatever in the way of evidence that would afford a reason for sup- posing his work on a premium job had anything to do with the acci- dent. I can describe the accident to you. The man was working upon the roof of a building — painting the roof — and he used an ap- pliance which is very common with painters, a long plank with cleats nailed across it to serve as supports, something like steps. This plank was laid kngthwise up and doWn the roof, and laid so the end of the plank was caught in the eaves — caught in the spout — so as to hold the plank from sliding down. And he moved up and down the plank and painted the.rbof, and then shoved it along horizontally and moved up and down again. In one position of the plank it passed over a skylight. The plank was quite strong enough to bear his weight when he passed over the 36162—16 11 162 METHOD OP DIKECTHSTG WORK OE GOVERNMENT EMPLOYEES. skylight, and he proceeded to pass over it, but he failed to realize that in passing over the skylight when he got to the point where th^ plank would not be supported under him he bore that portion of the plank down and tipped up the lower end out of the eaves. The -plank then slid down, with him on it, and he fell to the ground and was injured so that he died shortly afterwards. Now, that had not a thing in the world to do with the work on the premium system, as could easily have been ascertained by inquiry, indicating that this was a reckless statement. Another case given. He says: As recently as December 21 last, four days before Christmas, a young laborer, 36 years old, while piling pig lead, was killed. Although the latter was not working under the premium system at the time he met his death, the man preceding him In handling the pig lead was working under the premium system, and the evidence Indicates that the careless manner in which the premium worker handled the pig lead made it more difficult, if not more dangerous, for the laborer to pile it, and not only consumed more of the laborer's time but indirectly contributed to the laborer's death. There is no evidence that shows that at all. The Chairman. May I ask what you are reading from ? Gen. Crozier. I am reading from a speech of Mr. Deitrick in the House of Eepresentatives, January 22, 1915, in support of the amendment that contained some of the legislation that is in this bill before you. I am simply taking this occasion to refute some of the statements on which I believe action of this kind has been based heretofore, and if I had a chance on each of the statements before action was taken on them I think I could have refuted all of them. This is the only opportunity I have had to refute those statements in order that the refutation might have some effect. Mr. Nolan. Did not you have that opportunity of submitting a statement to the committee in the Senate after the bill passed the House ? Gen. Croziee. I did not have an opportunity to submit any state- ment to the Senate committee, any evidence of my own, after I saw this speech. The speech was not published until January 27, and it was too late to say anything about it before the committee of the Senate. Mr. Nolan. Had the bill passed the Senate ? Gen. Ceozier. The amendment was rejected in the Senate, and then was added to the bill in conference. Now, there is another statement made by Mr. Deitrick in regard to the discharge of a foreman blacksmith, and he lays that to the premium system. The correspondence on that subject is at the dis- posal of the committee, if you wish to see it, which will show con- clusively that this foreman was not discharged for anything that had anything to do with the premium system. Among other things, he says that the foreman stated to a workman under him that the time allowed the workman in which to complete a job was insuffi- cient; that the job that was given him to do with one of these task times affixed to it was one that he could not do within the given time; which was an unforemanlike act. This difficulty in connec- tion with him had nothing to do with the premium system, and he was not discharged for it; but if he made such a statement, it was an unforemanlike act. Mr. Nolan. What is the name of that foreman? METHOD or DIRECTING WOEK OF GOVERNMENT EMPLOYEES. 163 Gen. Ceoziee. Glynn. Mr. Nolan. You covered all that and filed a statement in the hearings in the last Congress. Gen. Ceoziee. Last year I filed all that correspondence, but it was after I filed that correspondence that this speech was made. The petitions mentioned in Senate Document No. 800 were signed, It IS true, by numerous employees. There are some letters which I have here by other employees, which speak ahout the same conditions and give the views of those employees, which are opposed to those of the petitioners. When the amendment carrying similar legislation to that which IS now proposed was added to the Army bill last year, in order to let the employees see what the effect would be, I gave it, by order, the same effect that it would have if it became law; that is to say, I directed that the premium payments cease at that time, except those which had already accrued. I thereupon received a petition signed by several hundred employees of the Frankford Arsenal, where pre- mium payments were made, asking that my action be withdrawn. The petition is interesting, as it gives the ideas of those employees in regard to the premium system. The premium system, as I have said before, was established at Frankford Arsenal at that time. The Setition is not very long. It has been published in the Congressional Record in connection with the debate on this subject in the Sejiate. Mr. Nolan. Was it not also used in the House at the time there was debate on that amendment by either Mr. Moore, or some other Representative from the city of Philadelphia ? Gen. Ceoziee. I do not know, Mr. Nolan. I do not think it was, but perhaps I am not quite accurate in regard to this particular pe- tition. It is dated January 28, and it could have been used in the Senate. It could have been used in the House, too. Here is the petition : petition. Pbankfoed Aesenal, Philadelphia, Pa., January 28, 19i5. Ohiee of Oednance, United States Aemy, Washington, D. G. Deae Sir: We, the undersigned employees of the Frankford Arsenal, do re- spectfully enter our protest against the instructions received from you yester- day suspending all premium payments at this arsenal. We have been informed that your action is based upon legislation contained In the Army bill recently passed by the lower branch of Congress, and that therefore your action is out of respect for the views expressed by that body. Our reasons for protesting are as follows : 1. The premium system of payment was established in the manufacture of small-arms ammunition about five years ago, and that there was a complete understanding between ourselves and the management of the arsenal that there would be no reduction of the premium rates while the manufacturing processes remain the same. This agreement has been lived up to by the management and by ourselves and to the mutual satisfaction of all concerned. 2. We believe that this system has been eminently successful, because, accord- ing to published reports, the manufacture of small-arms ammunition at Frank- ford Arsenal presents a decided economy when compared with costs of the same ammunition procured from private manufacturers. 3. The premium earned by all the employees engaged in the manufacture of small-arms ammunition during the month of December, 1914, has amounted to $3,747.72, or to approximately .$45,000 for the year, and therefore the abolishing of the premium system means an annual loss .to us of approxi- mately $45,000. 164 MiSTHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 4. Many of us, based upon the premium system of competition, have obli- gatfed ourselves td purchase hoihes, and If the premium rate is abolished it means the loss of our homes to us. 5. It is very probable that the branch of Congress which passed this legis- lation has in view ihe iiiterests of the employees, but we beg to differ on this very point. While the legislatloh prohibits rewarding us for our increased efforts which we give to the Government it does not prohibit an officer or foreman from requiring us to work just as hard as we are now working and for very much less compensation. The power of your authority and that of your oftlcers and your foremen to make us work hardei- has not been lessened by this legislaticin, but you have been dejirived of the opportunity of paying us for such increased work as you may give us to do. We therefore ask you to submit this petition to the Secretary of War, with the recommendation that he transmit it to Congress for consideration, and we hope favorable action. Respectfiilly submitted. f First indorsement.] Oednanck Office, January SO, 1915. To the Secretary or War : 1. The legislation referred to iu this petition is contained in a proviso of the Army bill, H. R. 20347, which passed the House of Representatives on January 22, and is now pending in the Senate. The language referring to the class of payments which have been suspended at the Prankford Arsenal is as follows : •> * * * * jjQ]. gfiaii any part of the appropriations made in this bill be available to pay any premium or bonus or cash reward to any employee In addition to his regular wagfes, except for suggestions resulting in improvement or economy in the operation of any Government plant ; and no claim for services performed by any person while violating this proviso shall be allowed." 2. As the legislation is claimed by its proponents in the House of Representa; fives to be in the the interest of the workmen who would be affected by it, 1 have considered it but just to all such workmen that they should have warn- ing as to the effect of the measure in case it should be enacted into law. I have therefore given the same effect to the prohibition that it would have if it become law by directing that all premium payments, except such as have already accrued, shall cease at the arsenal. William Ckozier, Brigadier General, Chief of Ordnance, United States Army. Mr. Denison. Who prepared that ? Gen. Ckozier. That is an indication of what those people thought. I have a number of other letters here from individual employees which I will not take the time of the committee to read. They also have been published in the Congressional Record in connection with the debate in the Senate, and they can be found there. They indi- cate that some of these employees are not afraid to come out and state their views in regard to the system ; and it is their belief that many of their fellow employees think as they do, but are afraid of the discipline, or something else which they apprehend, from labor organizations. They are therefore unwilling to be known as favor- ing the premium system. With reference to the second section of this bill, which makes it an offense to do either of the things prohibited in the first section, the offense being punishable by fine or imprisonment, I desire to call attention to the fact that the section makes it a very dangerous matter for any officer of the Government to follow any of the methods of efficiency which have an5nbhing to do with a stimulus to increase out- put which results from increased compensation. Also, it makes it dangerous for any officer of the Government to ascertain by any kind of a study in connection with time systems anything with regard to improved methods of doing work, or to inform himself in regard METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 165 to the time which such work should occupy. Of course, Qovernipenit officers can not be expected to run risks imder such legislation as this, and with the enactment of the legislation ^11 the efficiency which could result, and which has resulted from the attempts by payment to stimulate a good intention to work, and from the attempts by any timing operation to improve the jnethods of work, would be lost to the Government. As an illustration of one of the difficulties encountered in connec- tion with the legislation, section 1 of this act provides that no time study shall be made of any jobof any employee between the starting and completion thereof. At once there arises the question, What is a job? I have had that question up before me already. It says, " between the starting and the completion thereof " we are forbidden to take time; but that does not forbid taking the commencement of the job and tg.king the end of the job, as I read the language. Sup- pose a man is making articles by a repetition process, and he goes on making these articles day after day and week after week, and per- haps month after month. What is the job? Can we, under this law, measure the time of making a single article? Suppose the article requires more than one operation for its manufacture. Sup- pose it is something that is made on a lathe. Suppose it is a piece of material that is turned down to a given diameter and then faced off. Is the completion of that one article of a number a job or not? Or, can the only thing which it is lawful to time be considered the completion of a number of those articles ; and if so, what is the num- ber, when the work goes on continuously? That question has been raised, and I have been asked to decide in just such a case whether it is lawful to time the completion of a single piece. I am sure it is a very difficult matter to decide, and if the liability of the superin- tending officer or foreman to fine or imprisonment depends upon the right interpretation of the statute you may be quite certain that there will not be much risk taken. The question also comes up — and it has come up before, and we have spoken of it in this connection — what is a premium? Can we pay people on a piecework system? The only difference that I can find between the two systems is that the premium system is more advantageous to the workman in that it has a low limit of pay, while the piecework system has no such limit. Who is going to risk fine or imprisonment on such a distinction as that? When this legislation was under consideration in the Senate last year there was considerable discussion as to what constitutes a premium and what constitutes piecework. One Senator said there was very little difference between them. I think there is very little difference. Senator Hughes, of New Jersey, who was speaking in favor of the legislation, declared there was a great difference between them, and that there would not be any objection to piecework, al- though there was every possible objection to premium work, the premiimi system being iniquitous, while the piecework system was not subject to that charge. At any rate, it was not forbidden by this legislation. It is probably known to you all, because there is plenty of evidence of it, that organized labor, which is exerting itself to secure the passage of this legislation, is hostile to piecework, as well as to premium work. Here is a circular [indicating] which made its 166 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. appearance at the Frankf ord Arsenal. It is signed " Executive com- mittee, Federal Lodge, No. 687, I. A. of M.," which, I take it, means International Association of Machinists. With your permission I shall read it: FEANKFOBD ARSENAL EMPLOYEES, CAN YOU STAND FOK PIECEWOEK? Fellow Wobkees : The Congress which adjourned March 4 passed a bill which prohibited the use of any money appropriated for the Army being used for the maintenance of any so-called speed 'system. .Hardly two months have passed before the officials began to Inaugurate the piecework system, which, if not breaking the law direct, is at least breaking the spirit of the law, and they propose to start piecework and not guarantee you. a day rate; furthermore, they are cutting the rate you had under the bonus system. Now, fellow workers, organized labor has fought this system for years, and Intends fighting against its being placed in the arsenal. Will you sit still and let a few give up their time and money, or will you come In and help? Again, the officials, in the face of hard times, sublet contracts and caused a lay off, and their excuse is that the work '-' could not have been done advantageously " at the arsenal. Now, they have in the Frankford Arsenal the best mechanics that can be found anywhere and the latest improved machinery, and if they can not turn work out " advantageously " it must be up to the management of the arsenal, yet we are the ones that always suffer ; yet they boast of saving $1,200,000 last year, and already In one department of the arsenal $200,000 this year. All this saving, and could not " advantageously " give you the work. Now, it is up to us men. Come, get together and help organized labor to assert our rights and fight these conditions, for it is only through organized effort that we can accomplish anything. Executive Committee, Federal Lodge, No. 687, I. A. of M. In the report of the proceedings of the thirty-fourth annual con- vention of the American Federation of Labor, at Philadelphia, November, 1914, there is found this resolution. It is resolution No. 20, by Delegate E. J. Aspengren, of the Eock Island Tri-City Fed- eration of Labor. extracts from report of proceedings of the thirty-fourth annual conven- tion of the AMERICAN FEDERATION OF LABOR, PHILADELPHIA, NOVEMBER, 1914. Resolution No. 20, by Delegate E. .T. .Aspengren, of the Hook Island (111.) Tri-City Feder- ation of Labor. Whereas the United .States Government, in its arsenals and navy yards, has installed the piecework system in certain departments ; and Whereas this system is a menace to the worker in all trades and occupations through its vicious effects, viz, reduction of wages, increase in production, and the development of distrust and brutality among the workers, to the extent that it is almost Impossible to organize those employed under this system : Therefore be it Resolved, That the American Federation of Labor, in regular session assem- bled, condemn the use of the piecework system on Government work ; and be it further Resolved, That President Gompers and the executive council be instructed to use every means at their command that legislation may be enacted that will forever exclude the pieceworlc system from all Government establishments. Your committee congratulates the executive council upon the progress which has been made during the last year In uncovering the evils attendant upon the so-called Taylor system of scientific shop management, and recommends that the executive council continue its efforts to have a measure enacted which win prevent the operation of any system of shop management which includes the use of stop watches In connection with workmen's labor, or the application METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. 167 Of any system of payment of wages adopted for the purpose of speeding up workmen, and the elimination of such system wherever it exists. The report of the committee was adopted. (See p. 326.) Mr. Nolan. Do you Imow whether that resolution was adopted ? Gen. Croziee. It is stated that the report of the committee was adopted. It says, " See page 326." Gentlemen, I do not know that I need tell the committee that I have not interpreted this legislation as it was attached to the Army bill last year as forbidding piecework in the arsenals and payment in accordance therewith; but I was obliged to resort to piecework in some cases where I had been paying in accordance with the pre- mium system. Those employees at the Frankford Arsenal who signed the petition which I have just read to you were afterwards paid on piecework. That was somewhat technical. It was taking advan- tage of what the law permitted in order to give payment in accord- ance with the output, but it escaped the definition of premium. I may add that the comptroller has passed upon that, so that we were within the law in accordance with his interpretation. As it was a financial matter — the law only stating that none of the money should be expended in premium payments — all we needed for our safety was the opinion of the comptroller. However, when it be- comes a criminal matter, punishable by fine and imprisonment, the opinion of the comptroller is not a sufficient safeguard, and I should not direct any officer, with such a thin sheet of ice between him and fine or imprisonment, to follow the piecework system of payment. All the efficiency that you get from piecework would disappear. It is YBTj great, because that system of payment has been in operation in Government establishments for many, many years — 50 years or more; and a great deal of the work is done in accordance with that system, which does not differ in principle in the least degree from the premium system, which is forbidden by this proposed legislation, and which is forbidden in the legislation in the Army bill. A charge which has been made against scientific management is that it has for one of its objects the employment of unskilled or slightly skilled men in the work heretofore done by skilled trades- men. With regard to that, I will say that it is well known that that practice long preceded the introduction of anything that is called scientific management. We have been doing it for years. We use it at the Springfield Armory to make rifles. The rifle is not made to-day by one skilled gunmaker. For years we have been maldng that rifle by using a number of skilled men, each one of whom performs one operation. Then the rifle is afterwards assembled, so we do not have skilled gunmakers who make all parts of the rifles. The result is that we get a much better rifle and a very much cheaper rifle; and we have raised the average pay of that class of persons very considerably. There are just as many highly paid persons as before. We need skilled foremen, skilled assemblers, and so on. And we have given many other people a chance to make the high wages of machine operators giving a large output. I could use all the time that the committee has to devote to the subject, and a great deal more, in bringing up objections which I have heard, and then knocking them down. Mr. Keating. The method pursued by the committee has been this: Witnesses are permitted to make their statements and then 168 METHOD OF DIEECTIJ^G WORK OF GOVEBNMEJiTT EMPLOYEES. members of the committee ask questions. When yoii have concluded your statement, some of the members may have questions that they desire to ask. Gen. Crozier. I do not think it is necessary for me to go any further with this statement. I have indicated the sources of a great deal of information, and those sources are, of course, at the disposal of the committee. I have appeared before the committee myself on a previous occasion and I do not care to repeat what I said then, although the membership is probably somewhiat different. I shall be glad to answer any questions that anyone may care to ask. Mr. Denison. How many men, General, are working under the time system now ? Gen. Crozier.. There are none working under the time-study sys- tem, because we have been forbidden to make time studies. Under the premium system there are about 600 men who are subject to it at the Watertown Arsenal. Mr. Denison. Are there any at any place else in the Government service that you know of ? Gen. Crozier. No; because Watertown Arsenal and Frankford Arsenal were the only ones at which I had established premium sys- tems of payment, although piecework was in practice at a number of other arsenals. When the legislation of last year was passed I was forbidden to use the premium system with reference to any work which was paid for from the appropriations made in the Army bill, but I was able to use for it funds appropriated in the fortifications bill. I continued that system at the Watertown Arsenal as to those men who were engaged in work that was paid for from that bill. Mr. Denison. Have you had any complaints from the men them- selves on account of the system ? Gen. Crozier. Yes, sir ; I have had a great many. Mr. Denison. I do not care to have you go into it fully, but what is the ground of the complaints, briefly ? Gen. Crozier. One that I mentioned was that high-grade men did not have a chance to earn premiums, and that the low-grade men were the ones who benefited. That is absolutely refuted by the Jacts. I have a list right here of a number of complaints. Another was as between the workmen of the same grade, that one would get an opportunity to earn a premium while another would not be given a premium job, but would simply be given his work on a day rating. While we would like to avoid that, and are trying to avoid it, and are avoiding it more and more all the time, I think that is what is behind a great many of these complaints. I think that these work- men have been urged to believe — a great many of them, at least — that if this premium system could be abolished they would be able to secure the same rate of pay as they do under the premium system, but as straight day pay, without having to reach any given output. Many complaints have been presented to me accompanied by the statement that if I would give a 25 per cent increase of pay and leave it to the workmen, they would turn out as much work as be- fore. That I could not expect, however, because the record shows how much the output was increased when I made the change the other way. Mr. Denison. If this bill becomes a law, what effect will it have upon the establishments over which you have control ? METHOD OP DIEBCTING WORK OF GOVERNMENT EMPLOYEES. 169 Gen. Ckozier. If it should become a law in the form in which it is before you, I tliink it woulcj haye the effect of abolishing all time study permanently, which is abolished now only temporarily. It WQuld abolish all premium work and all piecework; and the effect ^f that would be, I should say, that the labor cost of a great deal of the work which we are doing would be at least doubled. Mr. Denison. Has organized labor made a formal objection to this efficiency system that you know of ? Qen. Ceozier. Yes, sir. If you will look at the congressional docu- ment to which I invited attention a moment ago, which is No. 800, you will find on page 40 the first formal objection that was made'to this system. That has been followed up by numerous other objec- tions. This first formal objection consisted of an official circular addressed by Mr. James O'Connell, international president of the International Association of Machinists, to the order everywhere, and forms an attack upon the system as we have it in practice, and calls upon the members of the association, among other things, to instruct the secretary or committee to immediately write to the Secretary of War, " to the two United States Senators of your State, and the Congressman from your district," protesting against the in- stallation of the "Taylor system by the Government, and asking the lawmakers to support any measure which might be submitted to secure this result. That circular was, of course, spread about among the employees of the Watertown Arsenal, and I think constituted the first incitement of those employees to dissatisfaction with this system. Before that it had been going on with the same appearance of cheerfulness, acquiescence, and cooperation that exists now in a higher degree than at any time before we introduced this system. This is denied, however, by the statements which come from outside the arsenal. Mr. Denison. As a result of this system, have you had a chance to observe whether or not there is a decrease in the vitality of the em- ployees, and whether it has an injurious effect upon the laborers themselves? Gen. Ceoziee. It has not, in the least. As I said a moment ago, the records show that the percentage of accidents among the pre- mium workers is less than among the dayworkers. I do not wish you to misunderstand the statement I made to the effect that the complaints come from outside the arsenal. They also come from within the arsenal, quite numerously signed; but the point I want to make is that I think they are incited from without. They are entirely out of accord with the spirit at the arsenal, as is apparent to anyone who is familiar with the daily affairs of the arsenal. Mr. Denison. Does the application of the system result in elimi- nating men or shifting them ? Gen. Ceoziee. We have a great deal of shifting of the men. We have not discharged any man as a direct result of the system. We have never discharged a man because he could not come up to the system. There was one case where a man had difficulty, and indi- cated a temporary refusal to work under the system, and who during the course of the interview that was going on in connection with the work discharged himself. In other words, he left the employ of the arsenal when he had ^ot been discharged. Some one may have told hirn that he was going to be discharged, but he was informed before- lYO METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. hand that he was not discharged. He afterwards tried to get rein- stated, but we would not reinstate him. When he left, however, there was no necessity for his leaving. Mr. Denison. General, what is your judgment, speaking with ref- erence to these men, as to whether or not this system will result in decreasing their vitality and health? Gen. Croziee. I do not see the slightest reason why it should. You must remember, Mr. Denison, that the effort which is made is only to ascertain what a workman can do reasonably, or can be rea- sonably expected to do. In that respect it constitutes a safeguard, be- cause without the system, in any effort to establish tasks, I do not see that we can do anything but resort to the pacemaker. If you have an employed pacemaker, he may be an exceptional man, and he would furnish the only standard you would have to go by in form- ing your expectation as to what a man should do. Even under this legislation this kind of process would not be forbidden. I can have a pacemaker, who can be paid high wages. He would turn out a great deal of work, and I could say to every employee, " You will have to turn out as much as that man or leave the establishment." There is nothing to forbid that, although it might be a cruel process. I do not say that I would do that, but I would be permitted to do it. Mr. Denison. Let me ask this question: Do you think that the enactment of this law, if it should be enacted, would result in any embarrassment to the Government or in any decrease in its ability to meet the situation in case we should become involved in a war? Gen. Cbozier. I think it would have a great influence on it. Mr. Denison. Will you state why ? Gen. Ceozier. Because in that case we would have, in the first place, no accurate knowledge of what a day's work should be, what the output of a workman should me, or what we should require him to do, or what we should tell him would be a good day's work. We would have inadequate means to detect soldiering, if it should exist, and we would not have any way to stimulate the men, except by an appeal to their patriotism, which, I have no doubt, would be effective in many cases. I will have to add, however, that the appeal would not be effective in many cases. Mr. Denison. In time of war, do you happen to know whether it is customary or necessary to appeal to men for extra effort in this line of work? Gen. Ceozier. Well, the most prominent example we have had has been in Europe recently in connection with the war. We are informed by the statement of the minister of munitions that at times the indisposition of some of the men working under the rules of the trade organizations to give such output as they could give has been a serious threat to England in her efforts in the war, and he has made very strong appeals to the labor organizations to sus- pend these rules during the war, I believe, with a great deal of success. I understand from his statement, or from his reports coupled with his statements, however, that he has not achieved com- plete success when he has secured the cooperation of the leaders of organized labor, because in some instances the men who have been trained in accordance with these ideas of the limitation of output have found other leaders, perhaps temporary ones, behind and under whom they have fallen in and have continued the practice METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. 171 of limitation, even contrary to the advice of the regularly consti- tuted leaders ; so that the harmfulness of inability to determine what work should be done and to apply at least the ordinary stimulus of reward and the harmfulness of the loss of knowledge of what the output should be, or how to ascertain it, has so many different aspects that I am afraid it woqld be a hopeless task to attempt to present them all to you. Mr. Denison. You think the practice of giving bonuses or pre- miums would be desirable in order to secure an increased output in case of emergency, such as a war? Gen. Crozier. Yes, sir; I think it is desirable in that case. I think that in time of war men can be expected to work right up to their limit. I do not believe it is possible to get them to do that without a stimulus involving an increased reward. I am aware of the view that inasmuch as soldiers go to the front and not only make the best efforts that they are capable of, but also incur great danger, it is no more than reasonable that the men should back them up in the workshops by putting forth their own best efforts. It is true, of course, that the soldier is getting very little pay. I do not be- lieve it is possible, however, to get those best efforts in the shop without a stimulus involving reward in a great many cases. I will say, though, that I believe it is possible in a great many cases to get it by simply appealing to a man's higher nature. Mr. Smith. A great many factories are now being operated by women, are they not? Gen. Croziee. Yes, sir. Mr. Smith. Is it necessary to have this stimulus in case the fac- tories are operated by women? Gen. Crozier. I am not informed about that. A very interesting document has been published showing the extent to which women are employed. I am astonished at the size of the work that is handled by them. I notice that they machine 6 and 7 inch projec- tiles which weigh 200 pounds or more. As to the particular means of stimulating them to effort I am not informed; but I have read other documents published by the British Government which have indicated a necessity not for stimulating those women but for hold- ing them in check, so that they would not injure themselves by overwork. Mr. Smith. Don't you think you could get a factory to a high state of efficiency without the stop-watch system? Gen. Crozier. I think we could not reach a high state of effi- ciency without that. Mr. Smith. In the present state? Gen. Croziee. I do not believe I could have gotten Watertown Arsenal up to its present state of efficiency without using the stop watch or some other equivalent time-measuring device. Mr. Smith. Do you use the Taylor system there ? Gen. Crozier. Yes, sir. Mr. Smith. When was that established? Gen. Croziee. It was begun about seven years ago. Mr. Smith. You had been connected with the factory before that? Gen. Ceoziee. Yes, sir. The output was very much less than it has been since its e^ablishment. 172 METHOD D? DIBECTIETG WOBK OF GGVEENMENT EMPLOYEES. Mr. Smith. You hayp improved the output? Gen. Ceozpb- Very much-; yes, sir. Mr. Nolan. Gpn. Crozier, can you give us information as to hpw that petition was circulated at th|e Frankfort Arsenal? Gen. Crqziee. It was circulated in the same way that any petitioij might be circulated in the interest of employees. Mr. Nolan. Do you know whether it was drawn up in the office, or by any of the officials of the Frankfort Arsenal, or by the em- ployees? Gen Ceoziee. I know it was not done at the instance of the officials of the arsenal or anybody on that side. Some assistance may have been given in the wording, so as to have it in a form to express what the employees wanted to say. I think that is likely. Mr. Nolan. Is that the general custom in the ordnance department when employees are petitioning Congress either for or aganst legis- lation? Do the officials assist in the preparation of petitions? Gen. Crozier. That has been done in several other cases that I re- member. In some cases I know also that it has not been done. Mr. Nolan. What other cases have you in mind where they got assistance from the officials in preparing petitions? Gen. Ceoziee. There is one case that I remember now, which re- lated to legislation which was added, I think, to the legislative, exec- utive, and judicial bill of 1912, which practically forbids the promo- tion of an employee for increased efficiency; excepting, however, artisans and laborers. It applies to such men as draftsmen, clerks, chemists, and engineers. This legislation runs something like this: It forbids the payment from any lump sum appropriation of any higher salary than had been paid the year before for the same or similar work, and its application is, for instance, to prevent the pro- motion of a clerk who might be taken on, new, at a low salary to perform a given kind of work, and who might so improve in the fol- lowing year that he could do twice as much. Such a clerk could not be promoted under that legislation. The only way would be to assign him to some other kind of work, if you had some other kind to which you could assign him. It would also prohibit the promotion of a chemist to take charge of a laboratory at' a salary which we would be willing to pay, if he developed into a good, capable man, fully competent to take charge of the laboratory, after having been taken on in charge at a lower rate. At the Frankfort Arsenal this last year— the same place this other petition came from — the employees of the class affected got up a peti- tion setting forth their case in greater detail than I am telling it. They petitioned for a change of the law in the respect in whidi it bore hard upon them, and that was a petition in which they were assisted in the preparation by the management, and it was forwarded through the management to me in the regular way. Mr. Nolan. Do you Imow whether the management of the arsenal called their attention to this legislation? Gen. Ceoziee. I called it to their attention. Do you mean this legislation with which this petition that I have filed is concerned? Mr. Nolan. Yes. Gen. Ceoziee. I called it to their attention. Mr. Nolan. That is the only other instance you recollect where that limitation was put in the legislative bill in the shape of a rider MEXSOD OF DIRECTING WORK OF GOVERNMENT EMPLO'YEES. 173 in 1912 ? That, by the way, did not prohibit promotion, but it pl-o- hibited the raising of salaries under the lump-sum appro{)riation. If you can find a place for an employee in a higher grade, he can go to the top, or you can proiiiote hiril. Gen. Ckozier. But in another kind of place. I can not promote him because of increased efficiency in his own grade. Mr. Nolan. Yes ; you are limited by that legislative rider. Gen. Ceozier. You asked me if I reiiiembered toy other case. Ones did come into my mind just as you were speaking. The law in regard to the leave of absence of employees in the Ordnance Department grants each and every employee 15 days' leave of absence each year. That law has been held by the comptroller to be a limitation as well as a grant. It was passed in the interest of the employee, and, in my opinion, it is a very good law. It has a defect, however, to which I shall call attention in a moment. Operating as a limitation, we are forbidden to give more than 15 days in any one year to an employee of my department, among others. The law, I suppose, when it was enacted, was intended to apply only to the continental United States, although it was passed after we had taken possession of the Philip- pine Islands. In the Philippine Islands and elsewhere in the Tropics, owing to the different conditions of employment aiid living, it is customary to grant to employees of the Government more than 15 days' leave of absence, but I am forbidden by that law to grant more than 15 days to them as well as to employees in the United States. Now, the employees affected in Manila got up a petition asking for a change in that law, and they were assisted in the wording of that and in getting it before the proper authorities by the officers. Mr. Nolan. In those two instances that you speak of, outside of the one petition you have presented, here, the legislation affected the official force outside of the mechanical department, did it not ? Gen. Ceoziee. In the last case I spoke of it affected all the official force in the mechanical department and outside. In the first case, the law as it was passed first affected both classes of employees, but afterwards, by subsequent legislation, the artisans and the mechanical department were relieved from the operation of the law. Mr. Nolan. In this legislation regarding the Taylor system, it affected only the mechanical force and did not affect the office force at all ; is that correct ? Gen. Ckoziee. That is true in accordance with our practice; but these methods might be applied to the office force, I have sometimes thought, with a great deal of advantage, but we have never dont that. Mr. Nolan. In regard to that order that you issued while thib legislation was pending, can you give the exact date of it ? Gen. Ceoziee. It was somewhere about the 26th or 27th of Jan- uary, 1915. My recollection is that I issued it as soon as the legit lation was attached to the Army bill in the House of Represent atives. Mr. Nolan. On the issuance of that order, did that order carry with it, besides a suspension of the bonus and premium system, an understanding that the employees going back to their original Wages would haVe to do the same work as they had done under the bonus and premium system. 174 METHOD OF DIEECTING WOEK OP GOVEENMENT EMPLOYEES. Gen. Cboziee. No, sir ; there was no understanding to that effect, and some did not continue to do the same amount of work. Mr. Nolan. There was nothing in the orders given by the superior officers over there, after receiving that order from you, that they would have to perform the same amount of labor ? Gen. Ceozieh. Not to my knowledge. If anything of that kind had come to my knowledge I would have forbidden it. There was one case that came to my knowledge afterwards, where a man was engaged on premium work when the order came, and he slowed down to such an extent that his work was only one-fifth of that which he had been doing before in the same time. Mr. Nolan. I understand a statement was made when the order was issued that while the premium and bonus system would not be in effect the men would be compelled to do the same amount of work. Gen. Ceoziee. I do not think that was the case. Mr. Nolan. We understood that an order was issued to that effect. Gen. Ceoziee. If that were true and I had loiown of it I should have caused it to be rescinded at once. I will say here, as bearing on the general subject, that I do not believe it is right to expect a man to turn out as much work at a day wage as he will turn out under the stimulus of a premium or bonus system of payment. I think that the regular system of wages which has been arrived at through long experience is the equivalent of the ordinary day's work. I sus- pect that they balance each other pretty well. When you want more work you should give more pay. Mr. Nolan. Did you understand at the time this measure was pending before the House in the last session that you would be com- pelled to stop the payment of premiums and bonuses; that is to say, where you had set a task, that you would be compelled to, stop the bonus or premium system, and that this bill would be retroactive? Gen. Ceoziee. I did not think that. I did not think the order was retroactive. I forbade the payment of premiums, except such as had accrued at the time of the receipt of the order. Mr. Nolan. In other words, you prohibited any further effort on the part of the officials of the Frankford Arsenal to pay a bonus or a premium from that day on? Gen. Ceoziee. Yes, sir. Mr. Nolan. Why did you issue that order at a time when this proposition had not become law? Gen. Ceoziee. Because I wished the employees to understand what they were threatened with. I wanted to get before them, by practi- cal experience, what was going to be their lot if this legislation were passed. Mr.. Nolan. Didn't they have that experience before you intro- duced that system? Gen. Ceoziee. They had had it a long time before. Mr. Nolan. How long before? Gen. Ceoziee. I introduced the premium system at Watertown Arsenal in 1911. I introduced the Taylor efficiency system in 1909. It went on for two years before we started the premium system. Mr, Nolan. As I understand it, this petition came from the Frank- ford Arsenal. How long had the bonus and premium system been enjoyed over there? METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES. 175 Gen. Ceoziee. I can not say, for the reason that the Frankford Arsenal, like the Springfield Arsenal and .the Rock Island Arsenal, is an establishment where that kind of payment had been going on for many years. I had not employed at that time in those places any systematizer or expert in shop management, with reference to the introduction of such a system. As Watertown Arsenal was one where there had been no piecework, I did employ a systematizer, so that date is more distinctly in my mind. The Watertown Arsenal does not lend itself to piecework payment. Mr. Nolan. Do you think it is proper. Gen. Crozier, for a man holding your high position in the Government service to issue an order of that kind for the purpose of working up the. employees, if I may use that term? Gen. Ceoziee. I think it is not only proper, but I think it is my duty to inform the employees who are concerned of anything of that kind which it is pending, and how it is likely to affect them. Mr. Nolan. Is there not a distinct difference between informing them of the effect of the legislation and putting into effect through an order the force of such legislation before you knew that Congress was going to adopt it? Gen. (SsoziEE. There is a difference, of course. By putting that order into effect I showed what would happen if Congress adopted this legislation, further than to merely inform these people. You must certainly know that to inform people of something which is impending in the future and may arise is not nearly so effective a way of making them thoroughly aware of what is involved as to put it into effect at once. Mr. Nolan. Following this out to its logical conclusion or its last analysis, suppose any officer of the Army should put into effect an order that affected the enlisted men while legislation was pending in Congress that would prohibit a certain system being abolished — a system that had been installed by Army officers — what effect would that have on the discipline of the men in the Army and on the entire establishment ? Gen. Ceoziee. It might have a good effect. I would not be certain that it would have a good effect unless I knew the case. Mr. Nolan. Is it good policy? Gen. Ceoziee. In this particular instance I think it was good policy, although it did not accomplish what I hoped it would. This legislation was conceived, or was said to be conceived, in the inter- est of the employees. I wished to let them see whether it was in their interest or not, and a great many of them thought it was not. Mr. Nolan. You purposely put it into effect for the purpose of creating opposition to the amendment? Gen. Ceoziee. I put it into effect for the purpose of letting them see how it would affect them. Mr. Nolan. And for the purpose of causing opposition to it ? Gen. Ceoziee. I thought it would have that effect in some degree. Mr. Nolan. You thought so? Gen. Ceoziee. Yes, sir/ Mr. Nolan. At the "Watertown Arsenal? Gen. Ceoziee. Yes, sir ; to a certain extent. Mr. Nolan. As a general proposition, did it have the same effect at Watertown Arsenal, where the entire time system had been ap- 176 METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES. plied, aiid not part of it ? You Said, as I understood it, that the stop-watoh system had ndt been introduced at Frankford; but at Watertdwri ? Gen. Croziee. Yes, sir. Mr. Nolan. That, as I understand it, is the nlost objfeCtionable feature of this system. Did it have the same effect at the Water- town Arsenal as it did over there? Gen. Ceoziee. No, sir ; it was not so extensive. Mr. Nolan. I am going to ask now in regard to Watertown. Dd the officials at the Wdtertowii Arsenal give the employee Considera- tion by consulting with him regarding the amount of bonus or premium to be paid ? Gen. Croziee. No; they do not. The rule under which a bonus or preihium is paid is well understood, and all employees who apply at the Watertown Arsenal for work are informed that that system is in operation there when they apply, so that they come to work under the system with a full knowledge that it is in operation. Mr. Nolan. Then the system itself determines the bonus or pre- mium to be allowed to the employee and the employee has no voice in the matter at all? Gen. Crozier. He has just the same kind of voice as he has in his wages. The employee is only asked with regard to his wages when he comes there, if he is willing to go to work for a certain sum. That is the only question he is asked. Mr. Nolan. He knows when he goes to work what his day rate will be and what rating he will have ? Gen. Crozier. Yes, sir; he knows when he goes to work. Mr. Nolan. And he generally knows pretty well all the ratings in the arsenal when he goes there? Gen. Crozier. Yes, sir. Mr. Nolan. After he goes there you place him under this system in all its phases. Do you then give him any voice in the matter of determining the amount of bonus or premium he may receive over and above his dav rate? Gen. Crozier. That is to say, do we tell him, when we give him a job of work, and give him the time in which it can be done, or the time in which he is expected to do it, that he will be given so much more if Mr. Nolan (interposing) . Do you consult with him as to what is a reasonable bonus or premium and as to whether or not it is satisfactory to him ? Gen. Crozier. No, sir. He is privileged, if he chooses to do_ so, to say that the time is too short, and that he can not earn that premium in the given .time. They oftentimes do say that. Mr. Nolan. Some one made a statement here to that effect the other day, and said that it was a general condition that the employees were consulted. I wanted to Imow if that was the situation at Water- town Arsenal. How long after the installation of the system at Watertown Arsenal did the strike of the molders take place? Gen. Crozier. The time study and premium system of payment, as I remember, was introduced at the Watertown Arsenal in May of 1911. It was commenced in the machine shop. I think the strike of the molders took place in August, 1911, when it was first attempted METHOD OF DIRECTING WOEK OF GOVEENMENT EMPLOYEES. 177 to establish the time study and premium system at the foundry. I think it was in August, but it may have been in July. Mr. Nolan. Do you know, of your own knowledge, ^^'hether these men were told to strike by their officers, or were encouraged to strike by the officers ? Gen. Croziee. Do you mean by the officers of the arsenal? Mr. Nolan. No; I mean of the International Molders Union? Gen. Croziee. I imderstood iii regard to that that the men, or their representatives, inquired of the officers of the central organization whether, under the circumstances, they would be permitted to strike, or whether their strike would be authorized; and they received an affirmati^■e answer. My belief is — it has been quite a while now — that they were not directed to strike by the central organization. Mr. Nolan. You mean the molders' organization? Gen. Crozier. Yes, sir. Mr. Nolan. I want to make it clear here, because I happened to be one of the officers, and probably knew as much about it as anyone, that they had absolutely no authority, as members of the molders' union, to strike. The members of the molders' union are not au- thorized to strike until they get the sanction of the international union. Gen. Crozier. That is what I understood, and our understanding is in perfect accord so far. Perhaps I have not the right to ask the question of you, but I should like to know this : Is it certain that the organization did not tell them to strike, but did authorize them upon application? Mr. Nolan. The application was never received. It was an in- dependent strike, and independent strikes are not recognized under the laws of the organization. I wanted you to be clear on that, be- cause we were not clear when you were here before. Gen. Croziee. Did you say that I was not clear about it when 1 was here before, or that the committee did not understand it ? Mr. Nolan. What effect upon the production of the WatertoWii Arsenal has this legislative rider or amendment attached to the last Army appropriation bill had during the time intervening sinc6 July 1, 1915? Gen. Crozier. I think it has had little, if any, because it is noi applicable at the Watertown Arsenal. The rider was not applicable at the Watertown Arsenal, or was applicable only to a very slight extent, because the work done at the Watertown Arsenal is not done with funds appropriated in the Army bill. There are a few teaih- sters up there engaged in hauling for shipment, and they are paid while they are doing that work, by the Quartermaster's Depart- ment. Their pay has been cut down, because it is impossible to pay premiums; but most of the work at the arsenal is prosecuted witJEi funds provided by the fortifications bill. Mr. Nolan. Eegarding those teamsters, were they enjoying a premium or bonus system prior to the passage of the act ? Gen. Crozier. I think they were, because their pay was cut down. Mr. Nolan. Why was it cut down, if this did not affect it? Gen. Crozier. Those teamsters were doing work connected with the transportation of the Army, and that is under the Quarter- master's Department, and is paid for out of funds appropriated by 36162— lis ^12 178 METHOD OF DIEECTIXG WOHK OE GOVERNMENT EMPLOYEES. • the Army bill. Therefore the payment of their premiums was forbidden. Mr. Nolan. Well, why were these men cut down when they were getting a certain amount of money prior to the passage of the act ? Gen. Crozier. For all that they did prior to the passage of the act they were not cut down, except during the period of suspension. Mr. Nolan. But, if they were doing a certain task prior to the passage of the act, this legislation did not affect them ? Gen. Crozier. These men, like all other men, had a day rate of pay, and for doing a certain amount of work in a certain ascertained any prescribed time they were given premiums above that pay. As the payment of those premiums from funds appropriated in the Army bill was distinctly forbidden, it would have been unlawful to continue them. Mr. Nolan. Is it your understanding that if a man was enjoying a bonus or premium which Avas really his day's pay, that he was affected by that legislation? Gen. Crozier. Any man who was enjoying a bonus or premium that was paid to him for work he was doing was affected by that legislation, if he was paid out of funds appropriated in the Army bill. Mr. Nolan. You say that most of the work comes under the forti- fications appropriation ? Gen. Crozier. At the Watertown Arsenal ; yes, sir. Mr. Nolan. You have still continued the stop watch and time study up there? Gen. Crozier. Not the time study, because the officers who would direct this are paid out of the Army appropriation bill, and they can not direct any more time study. Mr. Nolan. In the employment of a pacemaker, such as you spoke of a while ago, which method you seemed to consider the Govern- ment entitled to substitute for the other system, you stated that you would pay a high rate for setting a pace. Would you pay the other man who would do the same amount of work as the pacemaker the same amount of money? Gen. Ceoziee. I would not follow that method at all. I would not set a highly paid man to establish a rate for everybody else to ceach or be discharged. Mr. Nolan. Let us eliminate the term " pacemaker." Suppose you employed a first-class man and told him to do what you consid- ered a reasonable day's work and paid him what you thought he was entitled to get for that day's work, would it be your idea that the Government would pay the other men the same amount that he en- joyed, provided they did the same amount of labor? Gen. Ceozier. I think,- without the possibility of using the piece- work method of -payment, I should try to set a task where it was pos- sible, and would pay everybody who met that task the same pay. Mr. Nolan. The same pay that you paid the man who set the task? Gen. Ceozier. If I arrived at the idea of what the task ought to be in that way, I should expect to ; yes, sir. Mr. Nolan. Were you in charge of the Ordnance Department dur- ing the Spanish- American War? METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 179 Gen. Croziee. I was in the Ordnance Department, but during a considerable part of that war I was temporarily detached and as- signed to the Inspector General's Department. Mr. Nolan. Do you know of any instance where labor, either or- ganized or unorganized, in the Government, put any handicaps in the way of efficiency, and affected the service of the Government of the United States during the Spanish-American War ? Gen. Crozier. I do not know of any such case. Mr. Nolan. Do you know whether the employees generally Avere willing to cooperate wherever they found an emergency situation, in order to assist the men at the front to do their part at a great sac- rifice ? Gen. Crozier. I have no evidence to the contrary, and I do not be- lieve the contrary. Mr. Nolan. These questions Avere intended to foUoAv up the ques- tions of Mr. Denison. I Avanted to find out Avhat the attitude of labor was, and whether it was organized or unorganized in the Govern- ment establishments, and whether the men showed a disposition to cooperate with the Government and with the men at the front to get the most effective service. Gen. Crozier. I was not aware of anything troublesome in the at- titude of labor. Mr. Nolan. That is all. . Mr. Keating. In your statement of hoAv you determined upon the time that 'should be consumed in a task you said that you first took the time in which the ordinary workman might perform the task. You added two-thirds to that, and then two-thirds of that total, making the example which you cited. Now, Senator Borah, in a report on this Taylor system of shop management, which was sub- mitted to the Senate in the Sixty-second Congress, quotes what is alleged to be a paragraph from your annual report. It says " See Annual Eeport of the Chief of Ordnance for fiscal year ending June 30, 1911, page IT." I will read this : IT'or example, a workman has been doing a piece of work in 190 minutes. After painstaking study of the job and of all the means of saving time, the man is carefully instructed as to these means, and is told that for every minute saved, Ti'ithin, say, 120 minutes, he will be paid for half a minute at his regular rate, in addition to his regular daily pay ; and that it is thought that he can do the work in 72 minutes, for Avhich time the increase over his regular pay Avill amount to 33i per cent. Is that a correct quotation from that report? Gen. Crozier. I think so. Mr. Keating. May I ask you, General, how you reconcile that with your statement that you made concerning the manner of fixing the tasks? Gen. Crozier. Where do you find the discrepancy, Mr. Keating? Mr. Keating. In the first instance you said that a good workman had been doing the Avork in 90 minutes. Gen. Crozier. It is 190 minutes. Mr. Keating. In the example which you submitted half an hour ago you stated that if a good workman did the task in 90 miiiutes, you then added two-thirds of that, which Avould make 150 minutes, and then you added two-thirds of 150, which would make 250 minutes. Gen. Crozier. Yes, sir. 180 METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. Keating. And that you began offering a bonus when a man dropped below 250 minutes? Gen. Crozier. Yes, sir. Mr. Keating. According to this quotation, when you found that the workman had been doing a piece of work in 190 minutes, instead of adding to the time that he would be allowed to do the Avork, you began to substract. Gen. Crozier. Yes, sir. I see now where the question arises in your mind. That 190 minutes is not the time in which it had been determined, by careful time study, that a man could do the work. It is just the time that had been required by this workman going along in his usual way, with lost of lost motion and failure to take advantage of short cuts. It was done in the way in which a whole lot of the work is done in shops by good men and well-disposed men, as he was. Time study of that work would have shown that he could do that work in very much less than 120 minutes, which was afterwards set as the time within which he would be paid for saving time; that is to say, it had been ascertained that he could do the work very well in 72 minutes. Mr. Keating. You consider this a very fair illustration of what may be accomplished by scientific management? Gen. Crozier. It is an illustration that occurred in actual practice. Mr. Keating. That the ordinary workman takes 190 minutes to perform a task which, if he were operating under scientific manage- ment, he could perform in 72 minutes? Gen. Crozier. That is oftentimes the case. That is not extreme at all. Mr. Keating. Without any injurious effects on the workman? Gen. Crozier. Without the slightest injurious effects, and without working at a rate which he does not like. Mr. Keating. In order to bring about that result, is it necessary to provide improved facilities and machinery ? Gen. Crozier. Oftentimes time study develops the fact that some kind of an improvement is quite possible, and it is made, without which the man would never be able to do the work in the time allotted. Mr. Keating. Take this example that you incorporated in your annual report. It must have made a deep impression on you. Gen. Crozier. I might say that it was incorporated in the annual report because it was the first instance in which we had applied the time study and premium system to work. Mr. Keating. Did the planning room have anything to do with the result ? Gen. Crozier. I do not see where it would have come in. What you have in mind occurred seven years ago. It is not as fresh in my mind as it should be, perhaps. In order to have that man keep that up it would be necessary that he should have everything he needed right there. He should have the blanks on which he was going to work, the tools with which he was to work, and everything else of that kind. The planning room, therefore, would have some- thing to do with that, because it would have to see that these things were on hand. Mr. Keating. If we reverse these figures and start at the 72 min- utes, will we figure out 190 minutes in which the man will be per- mitted to perform the task? METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 181 Gen. Ceoziee. No, sir; there is no method of figuring by which 3^ou would arrive at the 190 minutes, because that was the time which the man had taken when he was working along independently, and without any special assistance and without this special study. There is no process by which the 190 minutes could be arrived at from these other figures. Mr. Keating. Let us see if that is correct: Suppose you take 72 minutes and add to that two-thirds, and then add two-thirds of that t(tal. Gen. Ceoziee. Well, we take 72 minutes and add one-third of that, which is 24. Two-thirds make 48, and adding 48 to 72, we get 120 minutes. When we speak of the 72 minutes, -we speak of the time which has been reached by finding the quickest time in which this workman could do this work and adding two-thirds. Having done that we reach 72. When he attains 72 minutes, he gets one-third premium. In order to get the time within which he would get some premium, we add the second two-thirds, and that gives 120 minutes. If he comes within 120 minutes, that gives him some premium. Mr. Keating. I beg your pardon. General. I am not much of a mathematician myself, but I think you are mistaken as to jout figures. The 72 minutes is the minimum time in which he can do the task, as I understand it ? Gen. Ceoziee. No, sir; that is the time in which he is reasonably expected to perform it, and not the minimum time. That is the time in which he can do it all the time. On a spurt, or with good luck, and in the quickest possible time, he can do it in less than 72 minutes. Mr. Keating. Let us refer now to f;his Frankford Arsenal order. You issued an order before the rider on the military bill reached the Senate. What was the nature of that order? I did not catch it when you made your statement. Gen. Ceoziee. I directed the suspension of the payment of all premiums except such as had accrued at the time of the receipt of the order. Mr. Keating. Did you notify the workmen that the premium sys- tem would be abolished in case the rider carried ? Gen. Croziee. I intended that to be the effect, except that I realized the rider was attached only to the Army bill. I fully expected that the same rider would be attached to the fortifications bill, and I have never been able to understand why it was not. Mr. Keating. How much of a reduction did that cause in the salaries of the employees affected ? Gen. Ceoziee. The best estimate can be formed by looking at tlie table which I have handed to the stenographer. Applying it to the month of January,, my recollection now is that the premiums paid in January, 1916, were $3,300. That kind of an order applied to the force existing this last January would have reduced the pay of the establishment $3,300. Mr. Keating. When did you revoke that order ? Gen. Ceoziee. As soon as the issue was determined by the passage of the bill with that legislation attached. Mr. Keating. You went back to what system ? 182 METHOD OF DIBECTING WOBK OP GOVERNMENT EMPLOYEES. Gen. Ceoziee. I stopped the premium payments at the Frankford Arsenal. I went back at the Watertown Arsenal to the system which had prevailed before I issued the order. Mr. Keating. What about the Frankford Arsenal ? Gen. Ceoziee. There I changed from the premium system to the piece-work system. Mr. Keating. What was the result on the salaries of the em- ployees? Gen. Ceoziee. I do not think there was very, much effect after that, as compared with what their salaries had been before I issued the order, because by an easy arrangement a piece-work system of payment was devised which gave the same pay as the premium sys- tem had given. Mr. Keating. You succeeded in that way in evading the will of Congress ? Gen. Ceoziee. I succeeded in avoiding the application of the reduction. I can not say it was the will of Congress, because one of the prominent advocates of your legislation — -when I say " your " I do not mean you personally — said it was not intended to apply to the piecework system. Mr. Keating. Would you share his view in case we passed this bill? Gen. Ceoziee. That may have been what he thought was the in- tention. It is a difficult matter to find out just what is intended by legislation sometimes. Mr. Keating. You knew this gentleman's ability as a lawyer? Gen. Ceoziee. I did not rest on that. I appealed to the comp- troller. Mr. Keating. You would not accept the comptroller's opinion, after the penalty was attached ? Gen. Ceoziee. I would not. Mr. Keating. It would be comparatively easy to determine what the will of Congress was, and execute it, would it not? Gen. Ceoziee. It would be then up to me to avoid the risk of direct- ing an officer to perform an act which might be a criminal offense. Mr. Keating. Didn't you understand that when Congress added that rider it wished the premium and bonus systems to be abolished in Government work? Gen. Ceoziee. I had no way of knowing the will of Congress ex- cept by its legislation. I can ]3erhaps throw a little light on the latter by saying : The Member of Congress who proposed that amend- ment, and at whose instance it was added to the law, was aware, before it was too late to attach that same kind of a rider to the fortifications bill, that without attaching it the legislation would not apply to funds under the fortifications bill, and he did not seek to do that. Mr. Keating. You did not' seem to experience any particular diffi- culty in interpreting the law when you issued the order suspending the bonus system at Frankford Arsenal. Gen. Ceoziee. The law applies to Frankford. Do vou mean Watertown Arsenal ? Mr. Keating. You issued an order at Frankford which you say you intended as a warning to the employees as to what M^ould occur in case it went into effect. METHOD OF DIRECTING WOEK OF GOVEBNMENT EMPLOYEES. 183 Gen. Ceozier. Yes, sir. Mr. Keating. Then, after the rider was put into effect, you came forward with a scheme by which you cA'aded the plain intent of Congress, but you did not tell the workmen you had that in mind when you issued the first order. Gen. Ceoziee. You say I evaded the plain intent of Congress. I did not evade it in the opinion of the comptroller. Mr. Keating. How about Frankford Arsenal? Was that order issued under a misapprehension of what this legislation meant or intended ? To be perfectly frank, you attempted to show these employees what you thought the effect of this legislation would be if it passed, and after the rider was adopted, you found means by which 3''ou could avoid the purpose of the legislation ? Gen. Ckozier. I found means by which I saved them from the disadvantages of the legislation. Mr. Keating. You did not suggest there was a way out of it when you issued the warning? Gen. Ceoziee. I did not. Mr. Keating. You referred to this legislation that was pending and you warned them if the legislation was passed a certain situation would be created, and you did that for the purpose of getting them to protest to Senators and Representatives? Gen. Ceoziee. I did that for the purpose of allowing them to protest if they wanted to. Mr. Keating. You are warning them that in case certain legisla- tion was enacted a certain condition would be created, and instead of that you created an entirely different situation ? Gen. Ceoziee. I found a way of saving them from it. Mr. Keating. You think it is perfectly proper, do you, for the Chief or Ordnance of the United States Army to conduct himself in that fashion? Gen. Ceoziee. I do. Mr. Keating. While legislation is pending in Congress? Gen. Ceoziee. I do. Mr. Denison. The questions that I put to you a while ago were propounded with the idea of finding out what the result would be in case of any emergency such as a war. I did not have in mind what the attitude of organized labor would be, and I do not think I stated anything along that line. I interrogated you* in order to get your judgment as to whether or not, under emergency conditions, it might become desirable to use a system of ]Dremiums or a bonus system in order to get an increased effort on the part of the men. That is what I intended to interrogate you about. Gen. Ceoziee. Yes. Under the conditions of war I would say that you would get better results by giving a reward than by not giving a reward. I will not confine myself to workmen. I will say any set of employees. I wish to emphasize the fact that I believe there are many employees — and there are just as many among the class called workmen as in the other classes — who would respond to an appeal to their patriotism under those circumstances. Mr. Denison. I have no doubt that the laboring men all over the country, in whatever field of work they are engaged, would respond as quickly, either to go to the front or do their part in the munitions 184 METHOD OP DIEECTING WOBK OJ? GOVEBNMEJSTT EMPLOYEES. factories, as anyone else, but I wanted to get the benefit of your judgment and your observation as to whether or not a condition might arise where the offer of a bonus or premium would result in an increased output. Mr. Keating. I know that you must have followed the develop- ments in Europe with a great deal of interest and accurate observa- tion, and I want to ask you if you are familiar with the attitude of the Welsh miners in their strike in connection with the output of coal in England during the war? Gen. Crozier. Not thoroughly, Mr. Keating. I only know what I have read in the newspapers. I have never read a Government publication on the subject. Mr. Keating. Then you are not familiar with the fact that during the dependency of that strike, while the coal miners of Wales were out of all the mines, a proposition was submitted to the cabinet of Great Britain which was substantially as follows: The members of the organization were to return to work in the mines and receive such compensation as might be necessary in order to purchase food to sustain life for themselves and their families, and they were to work such hours as might be determined safe if the men who owned the coal mines would undertake to sell the coal to the Government at cost. Gen. Ceozier. I never saw that statement, Mr. Keating. Mr. Keating. That is the case, and I mention it now merely that the record of organized labor in connection with the war in Europe, at least the English end of it, may be justified to a certain extent. I think you will find, if you examine into the disturbances in England in connection with the manufacture of munitions, that much of the controversy between labor and the Government arises from the fact that the laborers feel that the owners of the munitions factories- and the coal mines are earning tremendous profits, and that they are entitled to share in those profits. That is largely the case, and in the Welsh case it was exactly as I have stated it to you. The men were willing, practically, to work for their board, if the Government could get coal at cost. I am sure you have no desire, any more than I have, to place labor in a false light in that connection. _ Gen. Ceoziee. I think it may be of interest, if my attitude has anv significance in connection with this subject, to say that I have many times expressed myself as not opposed to the organization of labor. I think that no one in this world is sure of getting his bare rights unless he has some power to enforce them. In the case of the peoi:)le known as workmen, who have small power individually. I do not know of any way in which they can exert power, unless thev act col- lectively. Mr. Keating. It would naturally appeal to an Army officer. Gen. Croziee. Since you have questioned me at some lenath in re- gard to this incident at Frankford Arsenal, I would like to submit a short letter which I had not intended to submit. It was an informal letter which was written to me by the commanding officer of the arsenal at the time when I lifted the suspension of the premium payments, after the legislation had been enacted which we have been talking a;bout. This shows the effect of that lifting. It states the attitude of the employees, and throws some light on the question whether or not the employees like this system of payment which has METHOD OF DIEECTING WOEK OF GOVEENMENT EMPLOYEES. 185 been called into question. The letter is so informal that the writer forgot to sign it. He is Col. Montgomery. It is also so informal that the first sentence of the letter does not express what he meant to say. He speaks of my suspension of premium iDayments, when he really means the lifting or the removal of the suspension. I mention these things merely to show how informal the letter was. how far from an official document it is, and how it was never expected to be given any publicity. I will read the letter: Frankford Aesexal, PMladelphia. Pa.. iUirch 8, 1916. Gen. William Cuozier, Ordnance Office, War Department, Washington, D. G. Deae General : When your suspension of premium payments was announced In the cartridge factory, Shinlfle tells me that there was a complete change in the whole atmosphere of the building. Pessimism gave way to optimism, dissat- isfaction to complete contentment, faces marked with care to faces covered with cheerfulness, etc. There never was a better illustration of the fact that the premium system, when administered in the interests of the employees, is one of the greatest stimulus for the moral, physical, and financial well-being of the em- ployees. There must be cases, of course, where any system or task, whether premium or piece rate, etc., may be administered so harshly — as when the chil- dren of Israel were required to make bricks without straw — that it results in lowering the nervous and physical strength of the employee, but I believe that such cases are very rare, indeed. ■.Js ^f. ^. !]! ^ -^ :}: Shinkle was Maj. Shinkle, who was in charge of the cartridge branch of the arsenal works. Mr. Nolan. Will you submit, for the purposes of the record here, a copy of the order that you issued, as well as any correspondence that you had in connection with it? Gen. Ceozier. Yes, sir; I will be glad to submit a copy of the order. Do you mean correspondence inquiring as to the meaning of the order? Mr. Nolan. Any correspondence relative to it. Gen. Croziee. I have been corresponding with reference to the general subject ever since. Mr. NoLAK. I mean correspondence in regard to the order itself, which either preceded or followed it. Gen. Ceozier. I do not remember that there was any, but if there was I will submit it. Mr. Keating. There does not seem to be any further questions. We are obliged to you for appearing here to testify before the com- mittee. Gen. Ceoziee. I am very glad to have had the opportunity to appear before the committee. (Gen. Crozier submitted the following letters in response to Mr. Nolan's request:) [War Department telegram. Official business.] Washington, Jannanj 2Ji, 1915. COMMAKDING OpFICBR, Watertoion Arsenal, Mass.: Cease all time studies and all premium payments, except such as shall have accrued at time of notification of employees and notify them at once. Ceozier. 186 METHOD OF DIRECTING WOKK OP GOVEENMENT EMPLOYEES. W;\R Department, Office of the Chief of Ordnance, Washiiifjton, March 5, 1915. From : The Ordnance Office. To: The Commanding Officer, Watertown Arsenal. Subject : Resumption of premium payments. 1. Referring to the instructions of January 24, 1915 (O. O. 10222/535), directing the suspension of time .studies and of all premium payments except such as had accrued at the time of the suspension, you are informed that the suspension is hereby removed, and that time studies and premium payments, in accordance with the methods which were in practice at the time of the suspen- sion, may be resumed and continued until June next, inclusive, after which date elemental time studies and premium payments from funds appropriated in the Army act will be suspended during the fiscal year ending June 30, 1916. 2. You will receive further instructions concerning the legislation contained In the Army act, and the steps to be taken for carrying its provisions into effect. WlLMAM CrOZIER, Brigadier General, Chief of Ordnance, United States Army. [First indorsement.] Watertown Arsenal, March 8, 191.5. To Chief of Ordnance : Contents noted and necessary action taiien. C. B. Wheeler, Colonel, Ordnance Devartment. Commandina. War Department, Office of the Chief of Ordnance, Washington, January 26, 1915. From : The Ordnance Oflace. To : The Commanding Officer, Franljford Arsenal. Subject: Suspension of premium payments. 1. All premium payments will be suspended at once, except such as have accrued at the time of notification of their suspension, and the notification will be given at once. This does not apply to piece-rate payments, but only to pre- miums over and above regular day wages, which are paid to employees re- ceiving day wages. William Orozier, Brigadier General, Chief of Ordnance. United States Army. [First indorsement.] Frankford Arsenal, Januaiii 27, 1915. To the Chief of Ordnance : 1. The preceding instructions reached the undersigned at 2:50 p. m. to-day, as the greater part of the Washington mail did not reach this oflace until the afternoon. These instructions were promulgated to the shops by telephone and by publishing on bulletin boards the inclosed circular. George Montgomery, Lieiiteimnt Colonel, Ordnance Department, Commanding. War Department, Office of the Chief of Ordnance, Washington, March 5, 1915. From : The Ordnance Office. To: The Commanding Officer Franljford Arsenal. Subject : Resumption of premium payments. 1. Referring to the instructions of January 26. 1915 (O. O. 1808O-G/8O02), to suspend all premium payments except those which had already siccrued, you are informed that this suspension is hereby removed, and that premium pay- ments may be resumed, in accordance with the methods which were prevailing METHOD OF DIRECTING WOBK OF GOVERNMENT EMPLOYEES. 187 at the time of the suspension, and may continue until June 30 next, inclusive, after which date the legislation prohibiting premium payments from funds ap- propriated in the Army act take effect, and will remain in effect during the fiscal year ending June 30, 1916. 2. You will receive further Instructions in regard to the operation of this act, and the means to be employed for complying with its provision. William Ceozier, Brigadier General, Chief of Ordnance, United States Army. Committee on Labor, House of Representatives, Washington, D. C, Saturday, April 1, 1916. The committee this day met at 10 o'clock a. in., Hon. EdM'ard Keating (acting chairman) presiding. Mr. Emert. Mr. Chairman, we have no other witnesses to present at this time, because Mr. Richards, who was to have been a witness, -. Of course that is up to the committee. Mr. Emeet. I will communicate with Mr. Richards or you can, Mr. Chairman, whichever you wish. Mr. Keating. Suppose we let the matter rest until we get some- thing definite about your desire to have Mr. Frye here. Would you know this afternoon ? Mr. Nolan. Yes; I think I will. Mr. Keating. That would give sufficient time to notify Mr. Rich- ards, would it not? Mr. Emery. Yes. Mr. Keating. All right; then there is nothing further on that point. Mr. EiiEKx. We shall expect, of course, Mr. Chairman, that if any inquiry is made which reflects upon the methods of these gentlemen that the same inquiry shall extend to anyone who betrays an interest in this matter, whether for or against it. Mr. Keating. Of course the opponents of the bill have been ac- corded two full days here. Mr. Emert. I am referring to charges of this character. Mr. Keating. In case the committee goes into charges of this kind I am confident that I can safely assure everyone interested a fair and full hearing. Mr. Nolan. The reason I would like to have Mr. Frye is that he is the only one of those gentlemen I know. Prof. Hoxie would suit me as well as Mr. Frye or Mr. Valentine, all three, or any member of them. The gentlemen that were here made suggestions, but we have not heard testimony from anybody that had given this matter any ^reat amount of thought or that had conducted any investigation since the committee was appointed in the Sixty-second Congress and all the hearings were had on the bill in the Sixty-third Congress, and I think that somebody that had an opportunity to study this scientific management in the shops in which it is applied ought to come before the committee. I think that if Mr. Frye will come to Washington we ought to have the benefit of his statement. The fact is that I am in doubt as to whether they wrote that report as it was printed in the final report of the Committee on Industrial Rela- tions. I would like to have at least one of those three men come here and tell us just exactly what their views are on this matter, because they wrote a unanimous report, and I have not been able to get definite information on it, and I am in doubt as to whether or METHOD OF DIKECTING WORK OF GOVERNMENT BMPLO"SEES. 193 not the final report that was written was the one that was inchided in the final report of the Committee on Industrial Eelations: Mr. Emekt. Do I understand, Mr. Chairman, that you wish me to communicate with Mr. Eichards to ask him to be here at any particular time? Mr. Keating. I think before doing that we should ascertain whether the committee desires to continue the hearings on Monday or Tuesday. Personally, I am quite willing to go on, if that is the desire of the committee, but I think that we should, as far as possible, consult with some of the members. The understanding was that we would close to-day, but if there is important testimony to be pre- sented it might be well to put the matter over until Tuesday. Mr. Emeet. 1 will not be here personally on Monday, Mr. Chaii- man, but I will leave Mr. Eichards's address with the clerk, and I know that a communication from you addressed to him, or one from me if you wish -it — would get him here just as quickly as you desire. Mr. Keating. Will you leave his address with the clerk? Mr. Emery. Yes, sir. Mr. Keating. And it might be well for you to communicate with him. Mr. Nolan. We have got his address right here on that letterhead. Mr. Keating. Shall we proceed with Mr. Alifas? STATEMENT OF MR. N. P. ALIFAS, PRESIDENT DISTRICT NO. 44, INTERNATIONAL ASSOCIATION OF MACHINISTS, ROOM 3, NAVAL LODGE BUILDING, WASHINGTON, D. C. Mr. Alieas. Mr. Chairman and gentlemen of the committee, the people whom I have the honor to represent have been for the last five or six years interested in preventing the introduction and exten- sion of the Taylor system of shop management, or similar systems, in the Government workshops, and the bill that is now before you is one of the means toward that end. Our main reasons for opposing so-called scientific management, as exemplified in the Taylor system, are what the proponents of the measure claim it is going to do for us and do to us, and what the officials of the Government state that they propose to carry out. We have been criticised by the opponents of this legislation largely for resting a part of our opposition on apprehension. They claim that we should wait until something happens before we oppose any proposed 'system of management. Now, it seems to me that the re- spect in which human beings are superior to the brute is in their ability to reason and to deduct consequences from proposed actions. When we get to a point where we can not deduct what the probable result of certain measures are, we are not going to advance as a human race. I will state, however, that apprehension is not confined to our side. I noted in the remarks of the gentlemen who have opposed this bill that a large part of their opposition to our position is based on apprehension. They apprehend, in the first place, that if we stop these practices in the Government manufacturing plants that we are going to extend it to persons employed on contracts for the Gov- ernment, and then they apprehend that we are going to extend it all 36162—16 13 194 MICTHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. through, industry in the United States. That apprehension of theirs may be very logical, but if their argument as applied to us is good, if we have no justification to apprehend consequences, or what we ■conceive to be the consequences, of the system, then they should not make that argument themselves. They can not, with justice, be on both sides of the fence. They must either cease apprehending what this bill does not aim at or else give us the right to apprehend what we conceive to be the consequences of these systems of shop manage- ment. Applying our position to the War Department, let us suppose that if some foreign power should outline a procedure for taking ■possession of the United States, for bombarding New York, say, and taking possession of it, and intimate to this country that they were going to do that just as soon as they found an opportunity, and fur- ther outlined their plan of how they were going to take possession of certain strategical positions in the vicinity of New York. If the War Department should not become apprehensive and take measures to prevent such an invasion, I would very much question the wisdom of the officials of that department. It seems to me we have a right to apprehend evil" consequences when they are pointed out to us. Now, as to the justification for our apprehension, I would like to just quote you some of the writings of people who have favored the Taylor system. In the first place, a book known as " Shop Management." which is a product from the pen of Mr. Frederick W. Taylor, was presented some years ago before a body of scien- tific engineers, and was written at a time when he could afford i.0 be frank. He was not at that time under the strain of being obliged to make his system appeal to the public ; that is, he did not have to indulge in apologies for his ideas. He could be perfectly frank and free, and being a man who was experienced with handling industrial plants, and dealing with employers, I take it that he used the character of arguments he believed would appeal to manufac- turers in general, as something desirable to be attained. In reading paragraphs from this book it must be remembered that the kind of arguments and ideas presented in the mind of Mr. Taylor, at least, Tvould appeal to the people in whose workshops he desired to install liis system. The first intimation we had that the AVar Department was going to introduce the Taylor system was upon finding a copy of this book on the desks of several of the officials of the Eock Island Arsenal, in the machine shops. We read the book and concluded that that sort of system was not the kind that was going to be bene- ficial to the workmen, and we protested against its introduction. We learned that the Ordnance Department officials could see nothing wrong about the views presented in this book, nor about the pur- poses of Mr. Taylor; and we concluded that if their conception of fair dealing and proper treatment of employees was what this docu- ment claimed, why, we could see that their conception of fairness was entirely different from ours. There have already been read a number of extracts before this com- anittee by different members of the committee, and therefore I am not going to read very many— just two or three— to illustrate the different aspects of the question. I will state here that our opposi- tion to the system was mainly based on the proposition that it is so constituted as to form a speeding-up system. Every element of it is so arranged as to accelerate the workmen. It provides for the substi- METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 195 tution of cheaper workmen for the class of workmen that are now doing the work of the Government. It provides for a gradual elimi- nation of men who are unable to stand the pace. It is quite beside the question to ask whether or not the system has been carried out to that extent. That is another question, and we do not proi^ose to allow this thing to run along uninterruptedly until it has been carried out to its full extent. It would be manifestly unjust for anyone to expect' us to wait until all of this dire disaster had been heaped upon us before we began to protest. What we propose to do is to stop it before it goes that far. That is what our organization is for, and any reasonable man would expect that. If a man should hold you up at the point of a gun you would not wait until he shot you to try to take the gun away from him. You would take "the gun away from him first. It is not necessary for you to be shot in order to under- stand that a bullet is going to hurt you. One of the outstanding paragraphs in Mr. Taylor's work illustrating the purposes of his system is this: When the writer left the steel works the Bethlehem pieceworkers were the finest body of picked laborers that he has ever seen together. They were prac- tically all first-class men, because in each case the task which they were called upon to perform was such that only a first-class man could do it. The tasks were all purposely made so severe that not more than one out of five laborers (perhaps even a smaller percentage than this) could keep up. A careful inquiry into the condition of these men when away from work de- veloped the fact that out of the whole gang only two were said to be drinking men. This does not, of course, imply that many of them did not take an occa- sional drink. The fact is that a steady drinker would find it almost impossible to keep up with the pace which was set, so that they were practically all sober. This is taken from " Shop Management," pages 1361 and 1362. This ideal is held up to the employer as an example — as the goal that they want to attain in all shops. It must be admitted by anyone that if tasks are made so severe that a man who is even slightly addicted to the use of intoxicants is unable to hold his job that the work is fetting too strenuous. Regarding specific instances of employers aving it suggested to them to force worlanen to attain these tasks there is a colloquy to illustrate this point between Mr. Hawkins and Mr. Taylor in " Shop Management,"' pages 1479 and 1480, which reads as follows : I think that Mr. Hawkins has also overlooked another important factor, and that is the question of time. If Mr. Hawkins expects large results in six months or a year in very large works he is looking for the impossible. If he expects to convert union men to a higher rate of production, coupled with high wages, in six months or a year h6 is expecting next to an impossibility. But if he is patient enough to wait for two or three years he can go among almost any set of workmen in this country and not find the trouble which he did in Massa- chusetts. Mr. Hawkins. I have waited six years now. Mr. Taylob. Have you tried the incisive plan of centering on one man, instead of going at the whole shooting match at once? I think failm'e is due to a lack of patient persistence on the part of the employers and then to a lack of centering right on to a single man. No workman can long resist the help and persuasion of five foremen over him. He will either do the work as he is told or leave. That is the sort of persuasion they propose to use upon the work- men. I am not saying they have gone to those lengths in the War Department as yet, but they have not said they are not going to do it : in fact, the intimation is that they are going to do it. 196 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. In the report of the Chief of Ordnance for the fiscal year 1911, on page 17, he has the following to say : The confirmation of the claims as to the advantages of the features first installed, which the practical test at Watertown afforded, lends such force to these further claims that, in the absence of any positive evidence to the con- trary, I do not think they can be disregarded by an administrative officer . honestly desirous of serving the interests of the Government. At that time we had been protesting against the speeding-up features of scientific management. The Chief of Ordnance had in- stalled the first features ; that is, the routing of work and the plan- ning and estimating of work. We had not raised any considerable objection to these measures except in so far as they were going to be used as a basis upon which the rest of the system could be introduced. If these preliminary features were going to be used as a point of vantage from which they could force the rest of it on us, we were going to object to them, just the same as you would object to having a foreign fleet cross the ocean ^or offensive purposes, even though while crossing the ocean it would not be doing any damage to this country. The Chief of Ordnance says that from the success of this, these preliminary features, that there is some justification for assum- ing that the rest of it would be advantageous. But one of the features of the system is that it must be installed gradually; that they must not put on the screws until after they have got it pretty well under way and everybody is under the sway of it. Then they can proceed to get the output. That, I think, is some cause for ap- ju-ehension. The Chief of Ordnance has stated that judging by the success of the first parts of the system the supposition is that the rest of it is good, and ought to be applied. We have been assured prac- tically from year to year that the system is going to be extended, if it becomes feasible, and one part of the system that I have already referred to, that of displacing skilled men with nonskilled men, is one of the most objectionable. Mr. Taylor, in his work, says on page 1347, relating to the question of what he considers high wages, as follows : By high wages he means wages which are high only with relation to the average of the class to which the man belongs and which are paid only to those who do much more or better work than the average of their class. He would not for an instant advocate the use of a high-priced tradesman to do the work which could be done by a trained laborer or a lower-priced man. The advocates of scientific management claim that it increases the men's earnings. A man will get his basic rate, and then, because of his efficiency, he will get an added amount, which is called either a premium, or a bonus, or some such designation. That is true, pro- vided the basic rate is just, but they claim that by their system they are able to put a laborer on the work of a mechanic. The laborer gets his dollar and a half or two dollars a day, plus a premium ; but the day wage and the premium combined do not equal the amount that the mechanic got who was previously doing that class of work. That, in our opinion, is not increasing wages ; it is merely increasing a laborer's wages and throwing the mechanic out of work. If the process keeps up, anyone knows that the mechanic, in order to make a living, will compete with the laborer. He is going to offer his su- perior services for the same wages that the laborer is willing to work METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 197 for. That is about the way it would work out, if they had their way about introducing the system. I was going to cite the evident intentions of the War Department, or the Ordnance Department, in relation to that matter. In the re- port of the Chief of Ordnance for the fiscal year 1915, on page 17, he has the following to say : I do not myself find iu tlie practice of scientific uiauagenient in this depart- ment any sign of relief from the necessity for highly skilled workmen In at least the proportion in which we have heretofore employed them, but if I should meet such a possibility, I would not consider that the advantages of greater ease of production and improvement of the lot of less skilled workers would be offset by any supposed advantage in the maintenance of an unneces- sarily large proportion of highly skilled craftsmen. He says he has not found any relief from the necessity of highly skilled men. That intimates that it would be a relief if he could find some way to eliminate the highly skilled worlanen, and the pro- ponents of the Taylor system claim that they are able to do that if they are allowed to operate their system. Now, when an official of the Government continually tells us that he is going to tfy to dis- place skilled men and high-priced men with unskilled men and low- priced men, we think we are justified in opposing his schemes, .re- gardless of whether they have been tried out, or not. Now, as to whether or not the Ordnance Department would actu- ally do such a thing possibly needs proof. I will state that in actual practice the Ordnance Department has done that very thing within the last year in a number of instances. At the Frankford Arsenal, which is located in Philadelphia, they had in one depart- ment a lot of machines called Steinley machines. They had ma- chinists operating them at the rate of pay of $3.24 a day. The officials conceived the idea of putting unskilled men on those ma- chines, and they did so; men were put on these machines receiving $2.24 a day, $1 a day less. They transferred the men who were op- erating the machines to other work, and put the unskilled men on them. Shortly after that, work became scarce in the department to which the highly skilled men had been transferred, and they were laid off. However, before they were laid off, some of them, one of them in particular with whom I was talking, informed me that they had been offered to be put back on these Steinley machines if they would accept the $2.24 a day. That was a somewhat roundabout way of reducing wages, but it was doing it, nevertheless. These higher priced men were eliminated by promotion at first, and afterwards were not allowed to be placed back on these Steinley machines at their former rate, but were offered a low rate of pay. Another illustration taken from the same arsenal. Last fall we had an investigation there by a joint board, composed of employees which our organization had selected and the representatives of the management selected by the commanding officer, to investigate wages in that vicinity. The result of the investigation was the setting of a higher wage scale for different grades of work at that arsenal. They had one classification there known as automatic screw-machine hands and another one known as hand screw-machine hands; the automatic screw-machine hands receiving a rate of $3.76 a day, and the hand screw-machine hands receiving a rate of $2.88. No sooner had this wage scale been set and put in operation than the manage- 198 METHOD OF DIRECTING WORK OF GOA'ERNMENT EMPLOYEES. ment conceived the idea of just changing the manner of doing the work, and instead of having that grade of men on these machines, they put laborers on the $2.88 work. These laborers were getting $1.76 a day. They put supervisors over them to show them how to do the work. On the class of work that was to be paid for at the rate of $3.76, and which was supposed to be paid for at that rate, until changed as a result of another wage investigation, that class of - work was going to be done at $2.88, simply because the management conceived another method of doing the work. So that all the work we have done in investigating wages would go to nothing, provided that scheme went through. We protested against it. The result is that they are going to hire men at $2.88 and $3.76. That is the favorable result of our protest to the Chief of Ordnance. He has, however, specifically told us that if he thinks it is an advantage to hire these $1.76 men to do the $2.88 work, he is going to do it. He said the investigation was based on wages that were to be paid for men working under the former conditions of labor, and if he changed the conditions, he had a right to hire other kinds of men at lower rates of pay. He stuck to the theory that if he could do that work with the class of men getting $1.76, he was going to do it, and he had done it in some instances. That is not theory or apprehen- sion on our part. Those are facts. The War Department is no respecter of persons. What they would do to one man, they would do to another man. AVhat the Ordnance Department would do to a few men, putting them on the basis of $1.76 a day, we have reasons to believe would be done to all the high-priced men if the oppor- tunity presented itself, and we do not propose to allow that to be done, if we can help it. Now, that was not under the Taylor system, understand, but the officials who are running the Ordnance Department have become so imbued with the various features of the Taylor system that even though they do not apply all of it they apply it as far as they can, and while they do not apply the stop watch up there, or the pre- mium system, at| the present time they get just as near to it as the law, in their opinion, permits them. For instance, they insist that it is perfectly proper to time a man with a watch at the Frankford Arsenal at the present time, provided they time him for one piece only. I have been advised hj the men that on jobs that take only 5 or 10 minutes a piece, where they come in lots of 100 — we generally consider a lot of 25, 50, or 100 a job — they will take one piece and time a man with a watch on that and see how long it takes him to do it. That is contended by officials of the War Department not to be a violation of the intent of Congress. Some of the opponents of the pending bill have made mention of what they consider excessive penalties connected with the bill that is before you. In that connection, it seems to me that if officials of the Government are disposed to try to evade the evident intent of Congress just as far, in their opinion, as the law permits, there ought to be reason for some apprehension on their part that some- thing would happen to them besides a mere reprimand. In spite of the legislation that was passed by the last Congress, no heed has been paid to it by the War Department at the Water- town Arsenal as far as the premium system is concerned. That is due to the fact that this legislation was not attached to the forti- METHOD OF DIRECTING WOEK OF GOVEENMENT EMPLOYEES. 199 fications bill. It is true that they had to stop the time study on the 1st of July of last year, because the money from which the time study is conducted is paid out of the Army bill ; but before the 1st of July arrived, I am informed by the employees, the time-study men were? put on extra duty and were making all the time study they possibly could, presumably to tide them over the prohibitive season, like any- body would store up for a drought, or for the winter, thinking ((uite likel3»"_they could get along with the time study they had; and,, in conjunction with this, if they could evade the intent of Congress by taking money out of the fortifications bill to pay the premiums with, they could conduct the system at the arsenal without a great deal of interference, and that is what has been done. I would like to state why that provision was not placed on the- fortifications bill. We had been led from time to time, through: remarks that had been made by the Chief of Ordnance, to assume that if Congress once expressed itself definitelj' upon this question the system would be stopped. I do not find at this moment the particular citation that I had in mind, but the Chief of Ordnance stated in a hearing before the special committee that was appointed by Congress to investigate the Tajdor system that he would not continue a system that was continually the subject of controversy and dispute and created disharmony, and we were led to believe^ at least by inference, that if Congress once expressed itself on this question that the system would be stopped. Here I find the quota- tion above referred to. It is on page 4911 of the Congressional Record of February 23, 1915, and reads as follows : Mr. Tllbon. There is another question I would like to ask in regard to the- system. If, after a fair trial of the second part, as we have called it, of this Taylor system at Watertown Arsenal it should be found that it does not «vork , satisfactorily to both the Government and the juen after a fair trial, so it could not be claimed on either side that it had not had a fair trial, it should be discovered that it could not be installed satisfactorily to the workmen them- selves and to the management, do you believe that it would be installed at the other arsenals regardless of that fact? Gen. Cboziee. Anything that produced permanent dissatisfaction and discon- tent would be given up. We desire to have our relations with the workmen harmonious. We conceived the idea that if a clause was attached to the naval bill a;flfecting the Navy Department and one was attached to the Army appropriation bill affecting the War Department that that would be heeded by both departments as to the entire department, and our understanding or our belief in that matter was strengthened by the fact that three days after the Army bill passed the House of Representatives last year a notice was posted at the Watertowm Arsenal stopping the time .study and the premium system, and twa days after that, on the 27th of January, a similar notice was posted at the Frankfort Arsenal. This appropriation bill did not relate to the Watertown Arsenal, but it did affect the Frankford Arsenal directly. Now, if the Chief of Ordnance intended to show the em- ployees wha;t would actually happen under that bill he was mislead- ing them at the Watertown Arsenal, because afterwards he put the system right back again and insisted that it did not apply to the Watertown Arsenal. Now, on account of th6m stopping the system at these two arsenals just after the bill went through the House,. 200 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. everybody thought that that was going to be the result of the legis- lation and that it was not necessary to further burden Congress by taking up its time on the floors of both Houses for the purpose of doing a lot of unnecessary work. If the Chief of Ordnance had heeded that expression of Congress, this present bill would possibly not be before the House and it would not be necessary to conduct any further agitation against the Taylor system. During the debate on the measure in the Senate the opponents of the clause that was attached to the Army bill were continually ad- vising their colleagues to wait until the report came in from the Industrial Relations Commission. The Secretary of War had some time previous to this asked the Industrial Relations Commission to investigate the system at the Watertown Arsenal and report and intimated that he would follow their recommendations if within his power to carry out their wishes. Senator Root in particular, who led the opposition to our measure, brought out that point. That point has also been brought out in correspondence the Secretary of War had at that time with the Appropriations Committee of the Senate and Members of the Senate, asking them to hold this thing off until the Industrial Relations Com- mission had finished its report, intimating that his department would follow the recommendations of that commission. Now, the recommendation and Aiews of the commission has been made and expressed, and there has been no change made in the attitude of the War Department on the Taylor system. The commission has made a report on this subject of scientific management, covering about 22 pages, and they criticize very severely the various features of scientific management. It is true that this report does not confine itself to the Watertown Arsenal, but it covers 35 of the best, under- stand, the best shops operating under scientific management in the country. It savs so right here in their report that they have taken the best examples of scientific management, and they criticized them all. In toto, they do not carry out what scientific management pro- poses as a benefit to the working people. Among the criticisms they make is the lack of scientific accuracy, uniformity, and justice in time study and task setting. Mr. Ejiert. Would Mr. Alifas permit me to ask him a question thei'e? Mr. AxiFAS. Certainly Mr. Emery. You sav"the commission found out, Mr. Alifas. Do ycm mean the Federal Industrial Commission, or do you mean the committee that made the investigation, that submitted the report? Mr. Alifas. Mr. Chairman, for the gentleman's information, mv imderstanding is this, that the Industrial Relations Commission con- sisted of nine men. Four of them agreed upon the Manning report, and three of them agreed upon a supplementary report, and the other two members did not make any recommendations that covered all the features of the other commissioners' report. Now. the Man- ning report contains a criticism of scientific management The three men who composed the eniployers on the commission accepted the view of Mr. Brandeison scientific management, and I will brino- out in a moment or two, just what the result of their combined opinions on this question would be. METHOD OF DIEBCTING WORK OF GOVERNMENT EMPLOVEES. 201 Mr. Emery. I only asked, because I did not know, when you used the word " committee " or " commission," whether you referred to Mr. Hoxie's committee, or to the commission. Mr. Alifas. I am referring to the report that was presented to the commission by Mr. Hoxie and his committee, which was practically the only information the commission had before them for consid- eration. Mr. Keating. There is a call of the House, and it will be necessary for the committee to suspend, in order to answer to our names. I presume we better take a recess until 2 o'clock. Mr. Emert. All right, sir. Mr. Keating. I got a telegram from Mr. Frye that he will be here Monday morning. Mr. Nolan. I suppose we better try to make arrangements to-day, Mr. Chairman, to go on again Tuesday morning, after we meet this afternoon. That would give -Mr. Emery a chance to notify Mr. Richards. Mr. Keating. Would that be satisfactory to you, Mr. Emery? Mr. Emeet. Certainly. If any reflection or intimation has been made that reflects upon Mr. Richards, he ought to be here, by all means. (Whereupon, the committee took a recess until 2 o'clock p. m.) after recess. The committee reassembled at 2 o'clock p. m. at the expiration of the recess. Mr. Keating. Mr. Alifas, will you proceed? STATEMENT OF MR. M. P. ALIFAS— Resumed. Mr. Alifas. Mr. Chairman, at the time of adjournment this noon I was talking about what the industrial commission had recom- mended in regard to scientific management, and I was reading one or two headings of the commission's report as to failures of scientific management. The heading I was reading was this : " Lack of sci- entific accuracy, uniformity, and justice in time studj' and task set- ting." This is found on page 213 of the report of the commission. Far from being the inviu-iable and purely objective matters that they are pictured, the methods and restilts of time study and task setting are in practice the special sport of individual judgment and opinion, subject to all the possibilities of diversity, inaccuracy, and injustice that arise from human ignorance and prejudice. On the next page, 214, the following two paragraphs are found : Detailed observations of the practice of making time studies and setting tasks showed great variations in methods and results. Seventeen separate sources of variations are pointed out, any one of whicli is sufficient to and in practice does greatly influence the results of time studies. In face of such evidence it Is obviously absurd to talk of time stud>- as an accurate scientific method in practice or of the tasks set by means of it as objective scientific facts which are not possible or proper subjects of dispute and bargaining. Those paragraphs show that time study is inaccurate, and when time study is inaccurate, and when it is presumed by the employer to be accurate, of course injustice results to the employees, and conse- quently we are opposed to that sort of a practice. 202 METHOD OF DIKECTTNG WORK OF (30VERNMENT EMPLOYEEri. Regarding the question of pay, this report has the following head- ing, on page 215 : Failure to substantiate the claim of having established a scientific and equita- ble method of determining wage rates. On page 216 the following language is found: All of these systems definitely belie the claim that scientific management pays worlcers in proportion to their efficiency. One of them has the obvious intent of weeding out the lower grade of workers, while the other two are so consti- tuted as to make such workers very unprofitable to the employers. Two of them lend themselves easily to the exploitation of mediocre workers— those who can deliver a medium output but can not attain to a standard task set high. All of them furnish a strong stimulus to high efficiency and output, but in them- selves furnish no visible check on overspeeding and exhaustion. All of them are capable of being liberally applied, but all can also be used as instruments of oppression through the undue severity of task setting or efficiency rating. You will note that practically every abuse we have mentioned can be affected through undue severity of task setting or efficiency rating. Mr. Keatixg. Will it embarrass you to interrupt yon with ques- tions occasionally, Mr. Alifas? Mr. Alifas. Not at all. I will be very glad to answer any questions I can. Mr. Keating. The theory of the Industrial Relations Commission is that this machine can be used in such a way as to oppress the worker ? Mr. Alifas. Yes; it can be made very oppressive. Mr. Keating. If placed in the hands of unscrupulous or inconsid- erate employers or managers the system could very well become very oppressive to the worker ? Mr. Alifas. It could, according to their testimony. Mr. Keating. And has that been your own experience with it? Mr. Alifas. Yes; that has been my observation, and it has been the experience of many people with whom I have talked. I will cit« an instance to you a little bit later on that has received considerable publicity. On page 217, with relation to the question of stimulus, the follow- ing language is found : It must be admitted that these systems are admirably suited to stimulate the workers, but In so far as there may be virtue in the union principles of group solidarity and uniformity, and in so far as they lay claim to scientific accuracy or a special conformity to justice in reward, they must be judged adversely. Mr. Keating. Mr. Alifas, just on that point, how many efficiency systems are you familiar with — so-called emciency systems? Mr. Alifas. Well, I have a general knowledge of several, such as the Taylor system, the Emerson system, the Gantt system ; but there are enunierable other kinds of systems; in fact, there are almost as many different kinds of systems as there are efficiency engineers. They do not seem to be able to come to airy agreement as to what really constitutes scientific management. Each one calls his own system scientific and calls the other systems unscientific, possibly to the extent that they differ from his. Mr. Keating. Do they all adhere to the principles and teachings of Mr. Taylor? Mr. Alifas. Mr. Taylor is regarded as the founder of the system, and to a greater or larger extent all those that I am familiar with METHOD OF DIHECTING WOKK OF GOVEENMEN 1' ICMPLOYEES. 203 hearken back to Mr. Taylor's teachings. He is regarded as the founder of the science or so-called science. . Mr. Keating. But when it comes to elaborating that science, ex- pounding the science, the disciples differ as to method ? Mr. AiJFAS. They do, very materially. Mr. Keating. Does organized labor object in any way to the stand- ardization of tools, machines, etc., in industry ? Mr. Alifas. No, sir; they have never objected to real common sense shop management, which really is more entitled to be called scientific management. Organized labor is not opposed to industrial efficiency, but they are opposed to what these people see fit to call scientific management. It is merely a name for an ingenius set of oppressive practices. Mr. Keating. So that in so far as this so-called efficiency system '■elates to the standardization of machines, tools, nuts and bolts, etc.> organized labor would have no objection to that phase of the efficiency system ? Mr. Alifas. No, sir; no objection has been raised so far. Mr. Keating. Has organized labor ever objected to the systemati- zation of shops by which unnecessary and wasted effort is eliminated? Mr. Alifas. They have never objected to systematization as such. I will state that the.y have objected sometimes to apparently inno- cent methods of management, but on the ground that it is the intent of the management to use those methods as a basis for oppression; that is, much the same as the public might object to a man carrying a gun, especially if he said he was going to use it, not because the gun unused would hurt anything, but because its possession furnishes a temptation to use it. Mr. Keating. But in so far as the industrial establishments may have well-regulated planning departments proportionate to the size and nature of the shop, there would be no objection from organized labor to the systematization or the planning of the work or regula- tion of the shop so as to get the best possible results ? Mr. Alifas. There has been no objection to that sort of thing. Our objection has only been directed at abuses. Mr. Keating. Your objection is directed, then, primarily to a system which unduly stimulates the worker ? Mr. Alifas. That is the idea. Mr. Keating. So as to prevent him overexerting himself, either physically or mentally? Mr. Alifas. Yes; that is exactly it; and in that attitude we are upheld by this report of the Industrial Relations Commission. In their conclusion they have this paragraph : The social problem created by scientific management, however, does not lie in this field. As regards its social consequences neither organized nor unorgan- ized labor finds in scientific management any adequate protection to its stand- ards of living, any progressive means for industrial education, any opportunity for industrial democracy by which labor may create for itself a progressively efiicient share in management. Therefore, as unorganized labor is totally un- equipped to work for these human rights, it becomes doubly the duty of organ- ized labor to work unceasingly and unswervingly for them, and, if necessary, to combat an industrial development which not only does not contain conditions favorable, to their growth, but, in many respects, is hostile soil. ; I was going to mention, also, in response to a question propounded by Mr. Emery a little while ago, the attitude of the three employers 204 METHOD OF DIEBCTING WORK OF GOVERNMENT EMPLOYEES. on the Industrial Relations Commission with regard to scientific management. They claimed they accepted the views of Mr. Brandeis on the subject. For your information I will just read two paragraphs from the commission's report which substantially covers his attitude.. Beginning on page 422, and the paragraph on the top of the next page, the language is as follows : with the advent of. tlie new science of management has come the next great opportunity of increasing labor's share in the production, and it seems to me, therefore, of the utmost importance, not only that the science should be devel- oped and should be applied as far as possible, but that it should be applied in cooperation with the representatives of organized labor, in order that labor may now, in this new movement, get its proper share. I take It that the whole of this science of management is nothing more than an organized effort, pursued intensively, to eliminate waste. It is in the process of eliminating waste and increasing the productivity of man, to adopt those methods which will insure the social and industrial essentials, fairness in de- velopment, fairness In the distribution of the profits, and the encouragement to the working man which can not come without fairness. I take It that in order to accomplish this result, it is absolutely essential that the unions should be represented in the process. Now, that is what the employers on the commission subscribed to in toto. Taken as a whole there is no serious criticism against that. We agree that any system of management that will conserve energy and will lighten the burdens of people and will enable everybody to have more of the good things of life, and have it better distributed is a good thing. That part of it is all right, but he does not say any- thing here about the drastic features contemplated by the so-called Taylor system of shop management. In the first place, Mr. Brandeis calls this a "new science of management." Even supposing that it is a science of management, he says nothing about the different systems that we consider drastic. He merely contends that, assuming there is a science of management, it is in the direction of improved efficiency, just the same as a piece of improved machinery, and there- f oi'e it is good if introduced with labor having a voice in its operation. Now, these scientific management experts want to direct their in- vestigation and efforts only to a portion of the problem; that is, to .systematizing the industry and the workmen, and to get everything out of the workmen they can, but they do not propose to investigate the entire problem to ascertain how the profits can be distributed the most scientifically. They want the employer to retain the profits of this thing, if possible, but the workmen are to do the work. Now, if they would couple these things up, and say : " We will run the sliop scientifically, with the understanding that the profits of the business arc going also to be distributed scientifically so that the workmen will get the benefit," then the quarrel might not exist, but they do not propose to do that. In any partnership into which two or more per- sons may enter there is always the understanding that the partners are going to come to an agreement as to the distribution of the profits before they can do business. If they are going to do business first, and then run the chance or have it understood that one man is going to keep for himself all of the advantages of their cooperation, there would be no business done and cooperation. In that respect there is no conflict between the view here expressed by Mr. Brandeis and the view, expressed by the other members of the commission. "He con- tends that scientific management should be managed in cooperation METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 205 with the workmen, or that the employers should cooperate with the workmen, and the other members of the commission have addressed their criticism against scientific management operated automatically. The War Department has not been willing to introduce a system mutually satisfactory. Mr. Thompson, an attorney for the commis- sion, in conjunction with Mr. O'Leary, of the Molders' Union, and myself spent quite a little time to arrange a system of collective bar- gaining between the employees of the War Department and the War Department, but we disagreed at the point where the Chief of Ord- nance refused to allow any differences to be determined by an out- sider. He admitted that collective bargaining was all right, but he wanted to have the deciding voice himself. That is not our conception of collective bargaining, and of course, the whole thing fell through for that reason. Before citing the position of the Industrial Relations Commission on this question, I was stating that Senator Root, on February 23, 1915, had used before the Senate the argument that they ought to wait for the Industrial Relations Commission's report before they took action on the proposed clause in the Army bill to prevent the time study and premium system, and that the Secretary of War had taken that same position. Mr. Keating. Pardon me just a moment. Let me see if I catch the point you are making. Your contention is that in any efficiency sys- tem, whether scientific or not scientific, the workmen should be given an opportunity to share in the profits which result from this increased efficiency, this increased output, and that in increasing the workman's efficiency, his physical and mental well-being should be one of the primary considerations of the efficiency engineer? Mr. Alifas. Yes, sir. Mr. Keating. In other words, that the human machine should be conserved and protected by scientific management, and that that should be one of the primary purposes of scientific management, and that a scientific management which recklessly jeopardizes the life of the human machine is a dangerous scientific management ? Mr. Alifas. Yes, sir. Mr. Keating. And that a scientific management which increases the efficiency of the worker without proportionately increasing the compensation of the worker or reducing his hours of labor is an unjust scientific system? Mr. Alifas. Yes, sir; that is my position. Mr. Keating. But, as I understand, you have no objection to any system, whether known as a scientific system or an efficiency system, which conserves human life and which insures to the worker his proper share in the product of his toil ? Mr. Alifas. No, sir. Mr. Keating. In fact, you would welcome that kind of efficiency system? Mr. Alifas. We would welcome that sore of an efficiency system. Mr. Keating. Becase, if some one can show you where the worker can produce more in a given time, with less effort, it would tend either to increase the compensatioli of the worker or to shorten the number of hours that he would be compelled to spend at his task? Mr. Alifas. Yes. Now, things that we are compelled — or meas- ures that we are compelled to oppose when we are at a disadvantage 206 METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. and can not protect ourselves against encroachments we might wel- come if matters were so arranged that we were absolutely sure of protection. Mr. Keating. Well, it is your belief that when Mr. Brandeis pre- pared his brief that he had in mind the protection of the workers as the very first consideration? Mr. Alifas. I think he did. I think he had in mind an ideal sys- tem of society where one class of people was not trying to gouge the other, where industry was going to be run for the benefit of not only the employer but the workman, and that they were all going to share in the product, and there would be such a check upon any of the abuses of management that abuses could not exist. Now, no such conditions or safeguards exist at the present time. Mr. Nolan. That is all right, in theory ; but how does it work out in modern industrial life? Mr. Alifas. It does not work out, and that is why we are trying to protect ourselves against a system of management that lends itself by its very structure to these abuses. I have not found out any way by which the scientific management exemplified in the Taylor system could be worked without jeopardizing the interests of the worker, and that is why we are opposing it now. Mr. Keating. In one of Gen. Crozier's statements he refers to a case where the efficiency of the worker was increased 274 per cent and his wages increased 33-^ per cent. Would you consider that a fair distribution of the products of efficiency? Mr. Alifas. No; I would not. Mr. Keating. You would think the worker would be entitled to a larger share of what had been produced by his toil ? Mr. Alifas. Certainly. I will state that a great many of the alleged economies due to scientific management at the Watertown Arsenal are due to the introduction of the use of high-speed cutting tools and the purchase of better equipment and better machinery. That is outside of the speeding-up process. Such economies can be secured without the introduction of the speeding up of the workmen process, or the premium system and the stop-watch time study. It does not require time study to use high-speed steel. We have had high-speed steel in the machine shops all over the country for a num- ber of years, and my understanding is that the Watertown Arsenal before they started to introduce scientific management was in a very run-down condition and that it was not up to the standard of ordi- nary management, and therefore by introducing an intense system of management the difference between the output before and after the introduction of the system was very marked. Ordinary care would have possibly resulted in the saving the major portion "of the alleged saving due to the introduction of their system. Mr. Nolan. I think you will find, Mr. Alifas, under Gen. Crozier's testimony before the committee in the Sixty-third Congress an ad- mission that a great deal of credit, as far as the increased produc- tion in the Watertown Arsenal was concerned, was due to the fact that they sjrstematized the work and introduced modern methods and modern facilities; but on my asking the question as to what percent- age of this increased production was due to that and what in- creased production was due to the stop-watch and time-measuring systems he could not answer that question, but he did given consider- METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOyBES. 207 able credit for the increased production to methods that are not ob- jected to by the employees and that you yourself say are welcomed. Mr. Alifas. Yes. Mr. Nolan. So that he, while not giving us the percentage of it, admitted that a great deal — that is, that considerable credit — was due to systematizing the work up there, as well as the introduction of new methods in the various departments, so that the very point you are making there is admitted by Gen. Crozier regarding that Watertown Arsenal. Mr. Alifas. In the report of the Chief of Ordnance for the fiscial year 1911, on page 16, is found the alleged savings on two different kinds of materials manufactured at the Watertown Arsenal, and upon being questioned as to the details of these savings during the investigation that was made by the special committee of Congress in 1912, the information was elicited that one of the biggest items of savings was in the saving of material. It was claimed that they had saved half the material by the system. Now, that is a manifest absurdity. You could not save half the material in an in- dustrial plant. Where does the rest of the material go to? Cer- tainly nobody carries it home. The chances are that pieces of ma- terial secured for previous jobs were used in part, an.d then were thrown aside, and during the time that they were trying to show that their system was efficient, they would pick out all of these small pieces of material from under the benches, and out in the yard, and use them on the work they were doing, and not charge it up to the job. That was credited to the saving of the system, but after all that material was worked up, that sort of saving would cease, since mani- festly they could not continue the process of finding material in- definitely. That kind of saving would come to an end when the material that is laying around loose was used up. Mr. Keating. Are you a practical machinist, Mr. Alifas? Mr. Alifas. Yes, sir. I have served in the War Department alone for seven years. Mr. Keating. When you were learning your trade, did any one show you how to go about your task in the most efficient fashion ? Mr. Alifas. No, sir. If I recollect the temper of the competent machinists right in shops when I worked at the trade outside of the arsenal, if the boss had attempted to come around and pull you by the sleeve and tell you how to handle your work, there would be likely to be trouble started right there. A machinist felt that he knew his business, and he did not want anybody to be instructing him continually how to do his work, as though he were an apprentice. It was resented. Mr. Nolan. But I understood the question of the chairman to be when you were serving your appenticeship at the machinist trade. Mr. Alifas. Did you say apprenticeship? Mr. Keating. Yes; when you were learning your trade. Mr. Alifas. If I had instructors? Mr. Keating. Yes. Mr. Alifas. Oh, yes; an apprentice is always instructed on the different classes of work and machines, during his apprenticeship. Mr. Keating.. And in those 'shops they had superinteiidehts who planned^^jk, and selected the best tools with which to do the work. 208 METHOD 01' DIRECTING WORK OF GOVERNMENT EMPLOYEES. and if their employers consented, got improved and up-to-date ma- chinery, so as to increase the output of the plant ? Mr. Alifas. Yes; the foreman was around the plant continually, devising improved methods, and at times suggesting different things to the workmen to facilitate and expedite their work. It was usually done in a diplomatic way ; but he did not presume to interfere with all of their movements, such as a time study or motion study con- templates. Mr. Keating. But so far as " systematization " and " standardiza- tion," and " routing " and " planning," and these various other terms which make up the language of efficiency or scientific management are concerned, all those processes, while perhaps described by some other name, were known to industry long before Mr. Taylor formu- lated his system. That is, you systematized work, you standardized work, and you planned work, and you instructed the apprentices as to how to proceed with a certain line of work long before scientific management was brought into existence? Mr. Alifas. Oh, yes; but one difference was that they did not put it on paper, and did not hand it to the workmen on a sheet of paper. The foreman was not so much of a clerk as under the new system. He practically did all of his routing and planning, except it was not put down On paper. He kept in close touch with his job. Mr. Kkating. Pardon me for interrupting you. Mr. Alifas. Now, a great deal has been said by different witnesses, including the Chief of Ordnance, about the report that was made by the special committee of Congress investigating the Taylor system. They say that the committee recommended no legislation. I would like to read you the clause that they refer to. It is on page 7 of this report: The selection of any system of sliop management for the various Government works must be to a great extent a matter of administration, and your com- mittee does not deem it advisable nor expedient to make any recommendations for legislation upon the subject at this time. Now, further down in their conclusions and recommendations, they say as follows : Fourth. The management should put forth every effort to invite and induce full cooperation between the working force and themselves, and should, there- fore, deal with the working force in the most open, frank, and candid way, affording the fullest opportunity for consultation and explanation in advance of proposed action affecting the interests of the workmen. Stop-watch time study should not be made of workmen without their consent or any conditions be imposed upon them by authority which imply any indignity ; piecework may be introduced where the work to be performed is a continuous duplication, but with the express understanding that piecework rates shall not be cut unless the conditions of production are materially changed; in other cases the rate should be a straight day-wage rate at the highest prevailing rate for a similar class of work in the neighborhood where the Government work is to be per- formed, except that by mutual consent bonus and premium work may be intro- duced, but only with scrupulous care that the workman shall have full oppor- tunity for increasing his earnings without risk of overstrain, for collective bar- gaining if he should so desire, and for easy and direct appeal to the manage- ment in any cases where he may think his interests threatened. Now, after that committee reported I asked different members of the committee what they meant.by the expression that they " recom- mended no legislation at this time," and whether they jjidiyidually would recommend legislation at some future time. The^flBiption 1 METHOD- OF DIHECTING WOBK OF GOVEBNMENT EMPLOYEES. 209 received from these members was that they thought the advice given to the Ordnance Department in their report would be followed out ; they thought this was not a matter of legislation, but was a matter of administration, which was difficult to reach by legislation ; and they believed, as I was informed, that the War Department would fol- low their advice. Now, the War Department did not follow their advice; and since they did not, members of the committee informed me later that legislation would be proper under those circumstances. We took steps immediately to find out whether the War Department was willing to live up to the sense of this report. The War Depart- ment said they were not prohibited from going ahead as they saw fit, or words to that effect, and did not propose to abide by the recom- mendations unless it was followed up by legislation. We then pro- posed legislation, and that is why this legislation is before Congress at the present time. We have had investigations, and plenty of them. My impression is that the officials who desire to continue this system still want fur- ther investigations. Now, there is absolutely no legitimate object in continuing one investigation after another unless it is proposed to take some action after each investigation. Now, the investigation asked for by the War Department has been concluded, and regard- ing which they have intimated that they would follow the con- clusions reached. They have not done this. It seeips to me it would not serve any good purpose to have any further investigation ; some action should be taken by Congress based on the several investiga- tions already made. Another reason for not continuing any further investigation is found in the last report of the Chief of Ordnance for the fiscal year 1915, on page 17, where he says : I can not say that any new evidence has made its appearance in the opera- tions which have gone on since the submission of my last annual report ; but I can say that all the advantages which had theretofore shown themselves have continued to pre\'ail, and the spirit of cooperation and cheerful Industry which has shown itself in the everyday conduct of tlie Watertown Arsenal leaves little to be desired. This would argue that there is no necessity for any further investi- gation. He says there is no new evidence. Consequently, if there is no new evidence, there is no necessity for further consideration by way of investigation. Now, the quotation just cited was incorporated in the report which was signed by the Chief of Ordnance on October 1, 1915. It is stated here that a " spirit of cooperation and cheerful industry " prevailed at the Watertown Arsenal. I would like to explain to the committee just how cheerful that cooperation was at that writing. On August ■i,, 1915, a couple of months previous to the writing of this clause that I have read, there was submitted to the Chief of Ordnance a petition by a representative committee of the machinists at the Watertown Arsenal, protesting against the continuance of the Taylor system in the face of the legislation that was passed last year. It was ac- companied by a request for an increase in wages. To show that an increase in wages was justified, I will just cite here that there is at the present time a bill before this conamittee, a minimum- wage bill, providing for a minimum rate of $3 a day for all 36162—16 14 210 METHOD OP DIKECTING WOBK OF GOVEBNMENT- EMPLOYEKS. employees, regardless of whether they are mechanics or laborers. The average wage at that time at the Watertown Arsenal in the machine shops was $3.13. That is only 13 cents higher than this com- mittee is urged to provide for every laborer in the Government service. I will say that some years ago a laborer was paid $1.50, while a machinist was paid $3. That was about the general propor- tion. The machinists at the Watertown Arsenal are getting only 13 cents more than many Members of Congress believe a laborer ought to get, Mr. Nolan. Let me ask you, Mr. Alifas, does that apply to the whole arsenal, or does it apply only to the machine shop ? Mr. Alifas. Only to the machine shop. Mr. Nolan. When was that average made ? Mr. Alifas. That average was ascertained by an investigator on behalf of the Dapartment of Labor, who went up there to investigate wages at the arsenal, and wages on the outside. Mr. Nolan. How long ago? Mr. Alifas. He made his investigation along about October or November of 1915. I think it was in November. Mr. Nolan. This investigation was made since the introduction of the Taylor system up there ? Mr. Alifas. Yes, sir. Mr. Nolan. This average wage that is being paid now ? Mr. Alifas. Yes. Mr. Nolan. With all of the bonus and premiums that these men ha-('e been earning ? Mr. Alifas. No ; that is outside of the bonus aind premium. Mr. Nolan. That is for the day workers? Mr. Alifas. That is for the day workers ; yes, sir. That is the average day rate, and what they get, including their premium and bonus, and all, is not any more than we consider machinists in private industry in Boston, and machinists at the Boston Navy Yard are getting for straight day work. At the same time, an investigation was made on behalf of the machinists employed at the Boston Navy Yard, which is in the same vicinity, and we secured an average there of $3.84. That is 61 cents higher than the average prevailing at the Watertown Arsenal, where this scientific management is in operation. Mr. Van Dtke. How many men have you got working in the navy yards and arsenals in the United States? Mr. Alifas. There are pretty close to 5,000 in my organization, and that is perhaps 90 per cent of all of them. Mr. Nolan. That is, all machinists? Mr. Alifas. It is only machinists I am talldng about. Mr. Van Dyke. I mean all employees in the navy yards and ar- senals who would come under the provisions of this act, or who would be directly affected by the provisions of this act? Mr. Alifas. Now, there would not be very many affected directly. They would be affected indirectly by being relieved from the possi- bility of having to work under these systems. There are only about 600 employees that are actually working under this system, but about 35,000 people in the navy yards and arsenals will be subject to work- ing under the Taylor system if this act is not passed. Mr. Van Dyke. They might be, if the act was not passed? METHOD OF DIRECTING WOBK OF GOVERNMENT EMPLOYEES. 211 All-. Alifas. Yes. Mr. Van Dyke. There might be subject to working under the Tay- lor system, you say, about 35,000 of them? Mr. Alifas. Yes. Mr. Van Dtke. That includes all the machinists and laborers in the navy yards and arsenals in the United States? Mr. Alifas. Yes. Mr. Van Dtke. Outside figures? Mr. Alifas. Yes. Before we started on this colloquy I was outlining the state of affairs that existed at the Watertown Arsenal. The Chief of Ord- nance, in his report of October 1, 1915, says that they are cooperating cheerfully up there and there is a fine sprit of harmony prevailing at the arsenal. Now, this request for the discontinuance of the Taylor system and an increase in wages was the precursor of a very serious situation; that is to say, on August 31 I received a communication from our international president that he had received from a com- mittee at the arsenal a letter aslring that they be permitted to strike in the event the Government officials did not see fit to grant their de- mands. I will incorporate that letter in the hearings at this point. Mr. Keating. Without objection, it will be inserted in the record. Mr. Alifas. It will not be necessary for me to read it. The sub- stance of it is that they request him to allow a strike to be called in the event they do not secure satisfaction. (The letter referred to is as follows:) 23 Charles Street, Auhunidale, Mass., August 31, 1915. Mr. VPiLLTAM H. Johnston, International President I. A. of M., Jt02-Jt07 McGill BuiUing, Washington, D. G. Dear Sib : Since onr communication was forwarded to the Chief of Ordnance, William Crozler, pertaining to the abolishment of premium or rate system of payment, according to the latest returns, there has been no settlement. I take pleasure in announcing to you that the machinist representatives of irsenal Lodge, No. 150, also the representatives of Boston Lodge, No. 264, de- sire to place this matter in your hands for a settlement. It is needless to say that we have worked very diligently on this matter ourselves, and we have cooperated with the other departments for a settlement. * * * * * * « * I have been advised to ask your permission to take a walk-out vote, as now is the accepted time for this action, and report back to you the result of the vote, which no doubt proves to you just exactly how we feel. We have organized the machinists of this arsenal to better our conditions and for the purpose of discontinuing the premium system of payment and be returned to a daily wage, which is stated on the copy which was recently for- warded to you. We sincerely hope that you will take immediate action on this matter. Yours, respectfully, M. W. BOWEN, Chairman Machinist Committee. Mr. Keating. What percentage of the employees were represented by this suggestion? Mr. Alifas. About one-third; that is, one-third of the whole ar- senal, but practically all of the machinists at the arsenal ; one entire department. There was very little dissent among the machinists in the department. Mr. Keating. The Taylor system was in force' in this department? Mr. Alifas. Yes, sir. 212 METHOD OF DIBECTING WORK OF GOVEENMENT EMPLOYEES. Mr. Keating. These men who protested were in a position to gain the benefits of the bonus and the premium system, were they ? Mr. Alifas. Yes, sir. The men have taken the position up there that they do not want the premium and bonus. They would rather have the straight day work and get away from the system than to work under the system and get the premium and the bonus. Of course, they feel that they have been paid abnormally low. One of the features that is ascribed to scientific management is that under it employers aim to set the day wage sufficiently low to make the premium system attractive to the worker. In the event the premium system were abolished the day rate would, of course, have to come up in order to hold the men. Mr. Nolan. Eight there, Mr. Alifas, is it not a fact, and I believe it has been so testified to by Gen. Crozier, that prior to the installa- tion of this Taylor system up there, that there were only 10 men in the first class, of all the high skilled mechanics among the machin- ists in that arsenal? Mr. Alifas. Yes; I believe so. Mr. Nolan. And that they never let any more than 10 men get into that class; and their wage, t think, at that time was $3.54 a day. Mr. Alifas. Yes; $3.52. Mr. Nolan. $3.52. They never gave them an opportunity, no mat- ter how well skilled they were, to get into that class, and put a limit of 10 men on it. Mr. Alifas. Yes ; I think that was the arrangement. Mr. Keating. Was that a provision of the law ? Mr. Alifas. It is not the law, but that was the practice at the arsenal. Mr. Keating. Before they put in the Taylor system? Mr. Alifas. Yes; and that largely prevails there at the present time. They have a very small proportion of the men at the top rates. Their theory seems to be to have as much work a? possible done by cheap men. Shortly after that I received a letter from the employees there. I will state that before I received this letter I had communicated with the employees, asking them what was being done on the Taylor sys- tem, and if the legislation that had been passed by Congress had had any effect on the system. In the letter I received from the Secretary of our organization there, in response to my inquiry, is the follow- ing language. I do not desire to read the whole letter: Tou asked in your telegram concerning tlie premium system in tlie shoi). Wi' have tlie Taylor system as completely as ever, with tlie exception of the stop watch. The rate setters set the rate in the oflice. They still stand over a man all (lay Mith a blocli of paper and a pencil, but call it observing instead of time study. They have eliminated the watch. That was the status at that time, on August -2. 1015. On October 18, 1915, I received this communication. The send- ing of this letter was due to the fact that a certain efficiency engineer in Boston had sometime before that been given authority to represent the men on the .^^upposition that he was going to assist them in throw- ing out the Taylor system, including the time study and the premium system ; but when our legislation was pending in the Senate he wrote to the junior Senator from Massachusetts stating that he was author- ized by the employees to oppose the legislation' directed against the METHOD or DIBECTING WOKK OF GOVEKNMENT EMPLOYEES. 213 stop watch and the premium system, and upon finding out that lie differed with the employees and might be called to task for not carrying out his agreement, he resigned as their counsel ; so in order that there might be no dispute as to who had authority to represent them in Washington they wrote me this letter. I will incorporate the letter in the hearing. It merely indicates that they gave me un- qualified authority to represent them in Washington on these matters : Mr. Alifas. This letter follows the language of a previous authori- zation and includes the Industrial Commission, which had finished its work, but the employees doubtless thought the commission still had some work to do. Mr. Nolan. Did I understand there that this man was supposed to represent them in opposing the stop-watch, the time-study, and the bonus and the premium systems? Mr. Alifas. Yes, sir. Mr. Nolan. And then wrote to Senators stating that he was not opposed to it? Mr. Alifas. Yes, sir; and that he had authority to state for the employees that they were opposed to the pending legislation. Mr. Keating. Without objection, the letter will be inserted in the record. (The letter referred to is as follows:) International Association of Machinists, Office of Rbcoeding Secretaby, 11 Fairfield Street, Watertown, Mass., October 18, 1915. To whomsoever it may concern: This is to certify tliat Mr. N. P. Alifas. president of district 44, International Association of Macliinlsts, is authorized and empowered hereby to represent the machinists employed at the Watertown Arsenal, who are members of Lodge No. 150, International Association of Machinists, which lodge is com- posed of approximately 90 per cent of the machinists employed at the Water- town Arsenal. Particularly is he authorized and empowered to represent them before the Federal Commission on Industrial Relations and Congress on matters relating to the Taylor system of shop management as in operation at the Watertown Arsenal, or any other system of shop management. Very respectfully, [seal.] Jos. P. Lakkin, Recordinp Seoretari/. F. A. HOLWAY, President. M. W. BOWEES, C. E. Gtjlbkand, Maurice J. Lyons, S. G. Halbeeg, H. H. Beaton, Committee. Mr. Alifas. Now, along about that time I was having some cor- respondence with the Secretary of War, to see what could be done toward getting the restrictive clause in the Army bill applied to the Watertown Arsenal. I urged that the War Department should ob- serve the spirit of the legislation, regardless of whether it applied to all the appropriations that were available for their use, or not. On account of this matter pending before the War Department, I urged the employees not to strike, at least until we had an oppor- tunity to see what the Secretary of War would do about it, and they held this matter off. It was not until the 1st of January that I was 214 METHOD OP DIRECTING WOEK OF GOVEENMENT EMPLOYEES. unable to get them to hold off any longer. On that date they took a strike vote. The strike vote resulted in a large majority favoring a strike, but not a sufficient proportion of the men favored this plan to warrant a strike being called. That was due to the fact that some of the men thought it was better to wait and see what the War De- partment was going to do about this thing ; and some of them thought this matter could be straightened out in some other way besides striking ; so the strike was not actually called. Mr. Keating. You mean on January 1 of this year? Mr. Ai^iFAs. On January 1 of this year, 1916. All this trouble was brewing at the time the Chief of Ordnance claimed there were per- fectly harmonious relations existing between the management and the employees at the Watertown Arsenal. One of the reasons that may have deterred some of the men from voting for a strike was that for their protection I had been obliged to supply them with information as to restrictions of law against striking in the Govern- ment service. I had secured from the Secretary of Labor the provi- sions of law on strikes in Government shops, and I presented all that information to them in order that the employees should not be charged with violations of the law. There was no prohibition in law, in my judgment, against striking in the Government arsenals, but I wanted to have them be on the safe side, so I sent them that information. That may have had a bearing, however, on their de- cision not to strike at that time. Mr. Van Dyke. They were not classified civil service employees? Mr. Alifas. Yes; they are. Mr. Nolan. Mr. Alifas, right there, is it not a fact that all men in the Government service, mechanics in the Government service, as well as the organization that they belong to in the Government serv- ice, hesitate a long time before striking in Government shops, whereas in private employment they would not hesitate nearly as long as they do in the Government shops? Mr. Alifas. That is very true, Mr. Nolan. If that had been a private shop, I imagine we would have had a strike five years ago; and it would have come to a show-down whether they were going to have scientific management or not; but all American people feel that the Government is going to be just eventually, if they can only wait long enough to get the Government to take action ; and merely because some of the officials of the Government are unyielding is not an indication that the entire Government is going to be unyielding. The employees have waited for a long time to get either the depart- ment or Congress to take action on this matter, and they are still waiting. I would like to submit for the record here the correspondence I have had with the Secretary of War on this subject, which is now com- pleted, the Secretary having recently resigned, much to our regret, since he was fair in most matters. Mr. Keating. Without objection it may be inserted in the record. (The correspondence referred to is as follows:) May 4, 191.5. Hon. LiNDLEY M. Garrison, Secretary of War, Washington, D. C. Deab Sir : According to press reports which appeared shortly after the close of the Sixty-third Congress, Brig. Gen. William Crozier, Chief of Ordnance, Is credited with saying in effect that it is his Intenton to continue the METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 215 premium system at the Watertown Arsenal, because the clause in the Army appropriation bill prohibiting time study and premium payments does not pre- vent him from using the funds in the fortification appropriation bill for that purpose. Subsequent to the appearing of these press reports, I had an interview with the Chief of Ordnance, and urged that the evident intent of Congress in passing this legislation be given its due weight and that the objectionable features of the Taylor system be eliminated. I learned that the Chief of Ordnance intended to continue as much of the Taylor system at the Watertown Arsenal as a literal interpretation of the clause in the Army bill would permit. In his opinion it seems that the depart- ment is permitted to continue the premium system. The reasoning of the Chief of Ordnance appears to be about as follows: The restrictive clause in the Army bill applies only to appropriations contained In that bill ; and does not affect any money that is provided in other supply bills; consequently, since most of the money spent at the Watertown Arsenal is provided through the fortification appropriation bill, the premium system can be continued from such funds, because the fortification bill does not contain the clause prohibiting time study and premiums. However, the time study will be discontinued, due to the fact that the Army bill provides the funds for the payment of the officers' salaries and a time study could not be made without the sanction of ofiicers of the department. We believe, however, that some attention should be paid to the spirit of this legislation, and to the evident intent of Congress, and the effect that the re- strictive clause in the Army bill was expected to have; and we most earnestly appeal to you from the decision of the Chief of Ordnance and urge that the time study and premium system be discontinued by the Ordnance Department in all of its arsenals not later than July 1, 1915. The debate in the Senate on February 22 and 23, 1915, indicated that both proponents and opponents of this anti-Taylor system clause were under the impression that If the clause passed it would prohibit these practices In the Government arsenals for at least one year. This impression was encouraged by the action of the Cliief of Ordnance in discontinuing time study and tlie premium system at the Frankford and Watertown Arsenals Immediately upon the passage of the Army bill by the House, and also by the language In com- munications forwarded to Members of the Senate by the Chief of Ordnance am' the Secretary of War, as the following will show. On January 25, 191ii. Hu following notice was posted on the bulletin boards at the Watertown Arsenal : "Memorandum: In compliance with instructions from the Chief of Ordnanc^e. all time study will cease; also all premium payments except such as have accrued at the time of this notification. " C. B. Wheelek, " Colonel, Ordnance Department, Commandinfi." This notice was inserted in the Congressional Record by Senator Weeks, of Massachusetts, on February 23, 1915, during his remarks on the clause in the Army bill. In addition to the remarks made by Senator Chamberlain, chairman of the Committee on Military Affairs of the Senate, relative to the clause prohibiting time study and the premium system, he inserted several letters and docuihents submitted to his committee by the War Department on the subject. The fol- lowing letter under date of January 30, 1915, addressed to the Secretary of War by the Chief of Ordnance, leaves the impression that the passing of the proposed clause would prohibit time study and the premium system at the arsenals. Please note the parts in italic : " Ordnance Office, January 30, 1915. " To the Sbcbetart or Wab : " 1. The legislation referred to in this petition is contained in a proviso of the Army bill (H. E. 20347), which passed the House of Representatives on January 22 and Is now pending in the Senate. The language referring to the class of payments which have been suspended at the Frankford Arsenal Is the following : ■< I « * * Nor shall any part of the appropriations made in this bill be avail- able to pay any premium or bonus or cash reward to any employee In addition to his regular wages, except for suggestions resulting in improvements or "economy in the operation of any Government plant; and no claim for services performed by any person while violating this proviso shall be allowed.' 216 METHOD OP DIRECTING WOBK OF GOVERNMENT EMPLOYEES. " 2. As the legislation is claimed by its proponents in the House of Kepre- sentatives to be in the interest of the workmen who would be affected by it, I liave considered it but just to all sitch workmen that they should have warning as to the effect of the measure in ease It should be enacted into law. I have therefore given the same effect to the prohibition that it would have if it became law by directing that all premium payments, except such as have already accrued, shall cease at the arsenal. " William Croziee, "Brigadier General, Chief of Ordnance, United States Army." The language contained in the last two sentences, when compared to the notice posted at the Watertown Arsenal, shows a striking similarity and indi- cated that the Chief of Ordnance wanted to impress the Senate with the idea that if the restrictive clause was passed the full force of its provisions would apply to the Watertown Arsenal. Two other letters submitted by Senator Chamberlain Indicate that the War Department wished the impression to prevail in the Senate that if this anti- Taylor system legislation were passed it would prohibit time study and the premium system at the Watertown Arsenal. The letters are as follows : " Wae Department, "Washington, January 30, 1915. " The President of thp Senate. " Sir: In the Army appropriation bill (H. R. 20347), which passed the House of Representatives on the 22d instant, there occurs the following legislation, added as an amendment upon the floor of the House : " ' Provided, That no part of the appropriations made in this bill shall be available for the salary or pay of any officer, manager, superintendent, fore- man, or other person having charge of the work of any employee of the United States Government while making or causing to be made, with a stop watch or other time-measuring device, a time study of any job of any such employee between the starting and completion thereof, or of the movements of any such employee while engaged upon such work; nor shall any part of the appropria- tions made in this bill be available to pay any premium or bonus or cash reward to any employee in addition to his regular wages, except for suggestions result- ing in improvements or economy in the operation of any Government plant; and no claim for services performed by any person while violating this proviso shall be allowed.' " The purpose and effect of this amendment is to prevent scientific manage- ment in the branch of the business of the Government which is affected by it. Surely this is a subject matter of great importance and should be dealt with directly and only decided after careful investigation and deliberation. It was not relevant to any matter contained in the Army bill, was not brought up in the hearings before the committee in the House so that both sides might receive full opportunity to present facts and reasons, and did not and could not receive full consideration under the circumstances, and when the amendment as adopted was presented to the bill on the floor of the House. Under the circumstances I feel that it is my duty to call the attention of the Senate to the situation, so that they shall not vote thereon In Ignorance of the importance of the subject matter. " This question has been agitated for some time past, and when brought to my attention I requested the Commission on Industrial Relations to carefully investigate this whole subject matter with a view lo reacliins :i proper con- clusion thei-eon. This matter is one peculiarly within the soopo of the juris- diction of that commission. Just what they have done as vet in the matter I do not know, but I feel very strongly that the reasonable course to pursue would be to await their action and determination. If for any reason the Senate does not feel inclined to accept this suggestion. I most earnestly request that a hearing be accorded upon this subject matter, so that all the facts and reasons which" should be known to the Senate may be developed before the Senate finally concludes the matter. " With a viem of acquainting the Henate somewhat more with the details of the situation, I have caused the Chief of Ordnance to prepare a .statement, ivhich accompanies this. " Very respectfully, " LiNDLEY M. Garrison, " Sccrctarii of War." METHOD or DIBECTIJBTG WOBK OF GOVEKISrMENT EMPLOYEES. 217 " Memorandum for the Secretary of War. " War Depaktment, " OrricE OF THE Chief of Ordnance, " Washington, Janitary 29, 19Jo. " Subject : LegisUitioB in .bill H. R. 29347 against time study and premiuni pay- ments at Government establishments. " 1. The prohibition of this legislation relates to two features of the system of scientific management which has been in practice at the Watertow'n Ar- senal, Mass., for something over five years. Tlie first feature which is pro- hibited, time study, is a method of determining by careful study the best man- ner and sequence in which a given piece of work shall be done, the most advantageous way in which its expeditious performance can be accomplished, and the time in which it can reasonably be expected to be done. Based upon the results of time study, an instruction card is issued to anv worliman who may be engaged up&n the work studied, and he is told that If he follows the instructions carefully and industriously he can probably do the work in the time which has been arrived at, and in that case he will be given a premium over and above his regular wages amounting to one-third of these wages, or a less premium for measurably approaching this time; his regular wages not being subject to reduction in any case, being fixed at a prevailing rate of the vicinity for work of like character. This payment is the second featuVe which is prohibited by the legislation in the bill. No watch is held over a workman otherwise than during the time study mentioned, and no workman is subjected to any timing process for the purpose of ascertaining whether he is working industriously. Time studies are made only occasionally, and as information accumulates which is available for use in arriving at the time in which work can reasonably be done, its employment is of diminishing frequency. All allow- ances are made so as to insure that work shall not be expected at a rate which is irksome, or even disagreeable, to the workman. " 2. There are other important features of the system of managemer>t which relates to systematization, orderly procedure, and efficient arrangement, not having relation to the care and attention which is expected from a workman or to any stimulus to industry upon his part ; but the features now proposed to be prohibited are the only ones by which the workman is let in to a share in the economy which results from better management accompanying the system. " 3. A monthly report is made from the Watertown Arsenal of the amount of work which has been done upon the premium system and the premiums which are earned thereon. The latest report which has been received, which is for the month of November last, shows that 33 per cent of all the work done at the arsenal in that month was in accordance with this system, and that the total amount of premium was $2,519.69. The shop in which were the greatest number of men who had premium work was the machine shop, and in this about 70 per cent of all the work done was on the premium system, and the average premium earned by the machinists for the time they were working on premium jobs was 24.12 per cent of their regular pay. It will be observed that the premiums paid during this period were at the rate of about $40,000 a year, and as there are in the neighborhood of 600 employees at the arsenal It follows that the wages of all were increased on an average of about $66 a year. Premium payments, but not time studies, are made also at the Frankford Arsenal in Philadelphia, Pa. ; ,and at that establishment these payments amount to about $45,000 a year. As stated above, these premiums are over and above the regular day wages of the employees, which are fixed by the rule that they shall be the same as those paid In the vicinity for work of like character, and which have not been diminished since the commencement of the application of the premium system of payment ; so that the charge that this system results in a demand for higher speed on the part of the workman without any ultimate Increase of wages has no foundation in the now well-established practice at these arsenals. I inclose a copy of the report from the Watertown Arsenal which is referred to in this paragraph, which shows the name of every work- man who was employed upon a premium job during any part of the first 23 days of last November ; the time which he worked upon such job ; the amount of premium which he earned ; and the ratio which this premium bore to his regular wages. There is also shown the average premium earned In each shop and the percentage of the total work In the shop which was done under the premium system. It appears that the total sum paid in premiums during these 23 days (19 working days) was $2,519 69; that the total number of employees 218 METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. who received premiums was 340 ; so that the average premium earned by each was $7.41, and the average daily premium $0.39 each. " 4. The workings of the system, the economies effected, and the advantage to the workman are set forth in the reports of the Chief of Ordnance for the years 1911, 1912, 1913, and 1914. The extracts from these reports for the years 1911 and 1912 which relate to this subject are published In an appendix to the report of the Chief of Ordnance for the year 1913, together with certain petitions of a number of the workmen at the Watertown Arsenal against this system, and the replies of the Chief of Ordnance thereto. A copy of this appendix is inclosed herewith, and there are also inclosed copies of the reports for the years 1913 and 1914. / invite special attention to these reports, as the subject can not be fully understood without knowing what is in them. They exhibit a high degree o/ advantage for the workman and such economy of manufacture for the Government that it seems inevitable that, if the economy is reduced, as it appears certain that it will be if the proposed legislation becomes effective, larger sums will be required for the operation of the arseiials. " William Ceoziek, " Brigadier General, Chief of Ordnance, United States Army." Judging by the remarks of the principal opponents in the Senate to the anti- Taylor system clause, they were under the impression that if this clause were enacted -into law the features it prohibited would not be permitted in the arsenals for at least one year. On page 4890 of the Congressional Record of February 23, 1915, in answer to a question by Senator Hughes as to whether the system had not already been abolished at the Watertown Arsenal and quoting the notice posted at the Arsenal dated January 25, 1915, Senator Weeks remarked in part as follows : " Mr. Weeks. Well, Mr. President, it would seem from the date which the Senator has given us that the action taken by the Chief of Ordnance must have been taken after or at about the time the Army appropriation bill was acted on by the House of Representatives, and he may have considered, in view of the action taken by that body, that it was best to suspend what the House evidently desired should be suspended until the Senate had acted: I did not know that that had been done." Please note the italic portion of his remarks. In commenting upon a letter Senator Weeks had received protesting against the passage of the clause in the Army bill, he has the following to say, the italicized portion of which Indicates that he believed the Watertovm Arsenal would be affected by the proposed legislation : " John Driscoll is a resident, I think, of Brighton. Mr. Ghipman is an organ- izer of efficiency methods, a resident of Cambridge, and writes that he»is repre- senting 221 of the machinists employed in the Watertown Arsenal. There are 666 men, or about that number, employed there. Not all of them are affected by the operation of this provision, so that Mr. Chipman undoubtedly represents a very large proportion of the men employed at the Watertown Arsenal who are affected by the provision. This is the letter that Mr. Driscoll writes to Mr. Chipman." The action of the Chief of Ordnance In discontinuing the time study and the premium system at the Frankford and Watertown Arsenals after the clause in the Army bill had been passed by the House would indicate that if that clause was enacted into law that it would have the effect which he had thus given it previous to its passage. The debate in the Senate indicated that both opponents and proponents of the proposed legislation were of the opinion that if this clause in the Army bill were passed that it would cause the War Department to discontinue the practices prohibited throughout the entire service, although everyone was no doubt perfectly aware that the clause was not universal in its scope. If taken literally. With the probability thus plainly in view, that if the proposed legislation were allowed to remain in the bill that time study and premium payment would be discontinued for at least one year, the Senate nevertheless 'allowed the clause to become law; and we therefore submit that if the War Department permits the Chief of Ordnance to continue these practices at the Watertown Arsenal it will be contrary to the wishes and the expectations of Congress We believe that Congress has expressed its wishes on this subject with suffi- cient clearness to warrant the War Department in taking the matter seriously even though the legislation does not amount to substantive law. The rules of METHOD OP DIEECTING WORK OP GOVERNMENT EMPLOYEES. 219 the House and the Senate are such that a clause which aimed to limit the uses of other funds than those contained in the particular appropriation bill to which it was applied could not be Incorporated without unanimous consent, since a point of order raised by any one Member of the House or any one Mem- ber of the Senate would defeat the proposition. Owing to the fact that the funds in the fortification bill of last year are available until expended, it might have been possible for the Ordnance Depart- ment to have evaded the antitime study and premium system clause by means of a literal interpretation even though it had been included in every one of the 15 appropriation bills ; because money might have been saved out of that ap- propriation with which to continue the prohibited practices for another year. It was therefore felt that one emphatic Instruction from Congress to the War Department ought to be as binding upon that department as several more of the same kind. It was believed that the department had sufficient respect for law and the evident intention of Congress not to avail itself of technicalities for the purpose of evading the intent of the law. The utterances Of the Chief of Ordnance during the hearings before the special committee of the House of Representatives, during 1912, indicated that he would not further force this system upon the employees of the Government if he learned that continuous objection was going to be made to it. His atti- tude up to the time of the close of the Sixty-third Congress appears to have been that he would discontinue the system as soon as some definite action had been taken by Congress in that direction, and his present intention to go as far as the letter of the law will pjermlt is entirely out of accord with the position it was generally assumed that he had taken. During my discussions with you some time ago on this subject, you reminded me that there might be some precedent for the position taken by the Chief of Ordnance in the position which the President of United States is alleged to have taken with reference to a clause in the sundry civil bill of June 23, 1913, which prohibited funds therein contained for prosecuting violations of the Sherman antitrust law from being used for the purpose of prosecuting labor unions. The President is supposed to have felt warranted In signing that sundry civil bill only because of the availability of funds from other appropriations for the pur- pose of prosecuting labor unions in case they should violate the Sherman anti- trust law. Permit me to call your attention to the difference between the posi- tion taken by the President of the United States at that time and the present position taken by the Chief of Ordnance: The President was confronted with the duty of prosecuting anyone that violated the Sherman antitrust law, and the decisions of the court at that time had included labor organizations within the scope of the law, consequently there was nothing for the President to do but to continue such prosecutions. On the other hand, the sundry civil bill of June 23, 1913, prohibited the use of any of the funds therein contained for the pur- pose of prosecuting labor unions under the Sherman antitrust law. However, it did not repeal any portion of the Sherman law which required such prosecu- tions to be made. The President, therefore, in order to live up to the law in both respects, would be required to prosecute all violations of the law accord- ing to the interpretations placed upon It by the courts, but he would not be permitted to use any of the funds appropriated that year for the purpose ; so that in order to carry out his duties he would be obliged to use other funds if they were available for the purpose of prosecuting the labor unions. In the case which is coming up for the decision of the War Department relative to the enforcement of a clause in the Army bill intended to prohibit time study and the premium system, the War Department is under no obligation to continue the Taylor system. There is no law that requires the Taylor system to be installed, and whether or not it is to be continued is purely optional with the War Department. Consequently, when Congress passes a law prohibiting certain featui'es of the Taylor system from being used, when it is clearly evident that the only reason why the legislation was not made substantive law and of universal application, was due to the fact that it would have practically re- quired unanimous consent to have it so framed, it seems to us that it becomes the duty of the War Department to heed not only the letter of the law but the spirit of it. In order to further show that the War Department should observe the spirit of this legislation, permit me to call your attention to the position the depart- ment took with relation to certain orders that have been promulgated for the guidance of its employees. Mr. Charles C. Anderson, a machinist, employed at 220 METHOD OF DIKBCTING WORK OiP GOVERBTMENT EMPLOYEES. the liock Island Ai-senal, was severely disciplined for an alleged violation of a shop regulation. The shop regulation read as fallows : " Officers and employees of the Ordnance Department are prohibited from ex- hibiting any drawings, statements, or papers belonging to the official records of the establishment to which they are attached, or giving any information, copy, or extract from the same, or any Information respecting the business of the departments to any person whatever, without in each case, an order from .the Chief of Ordnance." This regulation prohibits only the giving out of information. It does not prohibit the asking for it. However, that di.stinction did not appear to have any weight with the department in its conclusions. The department contended that the spirit of this regulation had been violated, and I would say that if this were our only defense in this case, our position would have been a weak one. Without entering into the merits of the Anderson case at this time, the point 1 desire to bring out is that the department does not approve of the practice of employees caviling in the wording of the department'^ regulations for the pur- pose of ascertaining if there be not some other way of doing the same thing that the regulations are Intended to prohibit ; and It treats violations of the spirit of its regulations the same as If the violations were direct. The employees at the arsenals, with few exceptions, are opposed to the Taylor system, particularly the time study and the premium features. During my visit at the Watertown Arsenal, the latter part of last month, the opposition to the time study and the premium system was practically unani- mous, and they ai-e patiently waiting for the 1st of July to arrive when it is hoped that time study and the premium system will be discontinued. Numerous statements made by officials of the Ordnance Department would imply that the employees of the Watertown Arsenal are perfectly satisfied with the system, and even a letter written by a Mr. Miner Chipman, an efflciencj- engineer, to Senator Weeks, under date of February 12, lOlo, would have the authorities believe that he, as counsel for the arsenal employees, was authorized to state that they were opposed to the legislation contained in the Army bill on the subject of time study and premiums. In rebuttal of this, permit me to call your attention to numerous petitions that have been filed with the War Department by the employees at the Watertown Arsenal asking the discontinu- ance of the system, and the more recent letters written by their authorized committee at the arsenal in which the legislation in the Army bill was favored and urged for passage. One such letter can be found in the Congi-essional Record of February 23, 1915, on page 4882. Mr. Chipman had absolutely no authority to represent the employees in the direction he did. He did have authority to represent them for the purpose of securing the elimination of the system, time study and premium included ; but he did not have authority to represent them for the purpose of urging the continuance of these features. Since the passage of this clause in the Army bill, Mr. Chipman has resigned as their counsel as he no longer represents their wishes. Since Congi-ess has already expressed its wishes on this subject, there ap- pears to us to be. no necessity for the department to wait until the Industrial Commission has made its report relative to this subject before it takes action. With all due respect to the Federal Commission on Industrial Relations, which is doing excellent work in many respects, Congi-ess, we believe, is a more au- thorltive body and the departments should carry out its wishes. For your information, I insert a copy of an order which has recently been promulgated by the Secretary of the Navy with reference to the clause in the Navy appropriation bill which prohibits time study and the pi'emium or bonus systems in his department. This order we consider eminently fair and in keep- ing with the position that we think the departments sliould take ; , " Navv Department, " Washington, April 19, W13. " From : Secretary of the Navy. " To : Commandant and industrial managers of all navy yards and stations. " Subject : Circular letter in regard to premium and bonus systems. " Attention is called to the proviso in the naval appropriation act for the fiscal year ending June 30, 1916, reading as follows : " ' Provided, That no part of the appropriation made in this act shall be available for the salary or pay of any officer, manager, Superintendent fore- man, or any other person having charge of the work of any employee of the United States Government while making or causing to be made with a stop- METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 221 (vatch or any other time measuring device a time study of any job of any such employee between the starting and completion thereof, or of the movements of any such employee while engaged' upon sueh work ; nor shall any part of the appropriations made in this act be available to pay any premium or bonus or cash award to any employee in addition to his regular wages, except for the suggestions resulting in improvements or economy in the operation of any Government plant.' " All premium and bonus systems of doing worlc and all time studies or timing of employees as defined in this act will be discontinued on or before June 30, 1915. " The wording of this act, however, is constructed as not prohibiting straight piece-work, that is, work paid for at a certain rate, such as per hundred rivets, per hundred feet of calking, etc.. etc., with or without a guaranteed day's wage in case of failure through no fault of the employee. " Where systems are in use, based upon premiums or bonuses, these should be charged, if possible, to straight piece-work, as defined above, provided such charge is acceptable to the employee. " .TOSEPHITS D.-iNIELS. " [First indorsement.] " April 2(>. 1915. " From : Connuandant, Washington, " To : Departments concerned. " 1. Referred for compliance. E. W. EnBRLE." The introduction of piece work, of course, is intended for departments outside of the machine shop. Machinists will not work piecework, as their work is not sufficiently uniform, and the Navy Department is not forcing it upon them. We trust that the War Department will permit the machinists to continue the day work system after discontinuing the premium method of pay. For your information, I am also appending hereto a clipping from the Vallejo Times, Vallejo, Cal., contained in their issue of April 23, 1915, which shows the effect upon the workmen of the premium system when drastically applied. The last four conventions of the American Federation of Labor have gone on record favoring the discontinuance of the Taylor system in Government plants, and organized labor throughout the United States is practically unani- mous in its desire to prevent these abnormal speeding systems from becoming general in use. This question lias been sufficiently discussed through our conventions, our labor press and other means of disseminating information, for labor in general to watch with the keenest interest tlie position which will finally be taken by the War Department. Trusting that a favorable decision will be reached, and hoping to be advised of your conclusions at an early date, I remain. Very respectfully, yours. President District No. 44, International Association of Machinists. War Department, Washington, June 2Ji.. 1915. My Dear Sir: I herewith hand you for your information a copy of memo- randum of the Judge Advocate General concerning the legislation with respect to the premium system. I have read this memorandum over, and it seems to me that it is well con- sidered and that the determination therein announced is proper. If you desire to make any statement to me as to why I should not adopt the policy in question, you are free to do so, but it must be in my hands in writing by Monday of next week)- as I shall want to act very promptly. Sincerely, yours, LiNDi.EY M. Garrison, Secretary of War. Mr. N. P. Ai.iFAS, President District No. 44, Government Employees' International Asso- ciation of Machinists, Room 3, Naval Lodge Building, Fourth Street and Pennsylvania Avenue SE., Washington, D. C. 222 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES, Office of the Judge Advocate Genekal, Washington, June 5, 1915. Memorandum for the Secretary of War : Subject: Use of fortification appropriation for continuing the premium system of employment at Watertown Arsenal : Protest of Mr. N. P. Alifas, president disti'ict No. 44, International Association of Machinists. 1. The views of this office are desired vsrlth reference to the provisions in the Army appropriation act of March 4, 1915 (38 Stat, 1083), forbidding the use of the appropriations made in that act for the payment of premiums or rewards based upon the quantity of work in the manufacturing establishments of the Ordnance Department, and the fact that a similar provision is contained In the naval appropriation act of March 3, 1915 (38 Stat., 953), as to whether the terms oj the prohibition should be applied to manufacturing work at Water- town Arsenal, Mass., payable from appropriations carried under the fortification appropriation act (38 Stat., 888). In other words, the question Is: " In considering the particular provision in question In connection with the whole subject matter Is there weight In the suggestion that we should ethically observe the spirit of the legislation and prohibit the Interdicted things every- where In the War Department? " 2. It is conceded that the provision in the Army appropriation act forbidding the application of the so-called " Taylor system " in the payment of premiums or rewards from appropriations contained in that act, being expressly limited to the expenditure of those appropriations, does not legally bind the Secretary of War with reference to appropriations carried by the fortification act. It is contended, however, that the legislation should be regarded as an expression of the policy of Congress that the " Taylor system " should not be applied to Government work, and that the Secretary of War should, in the exercise of his discretion, ethically observe the spirit of the provision with reference to work carried on under appropriations contained in the fortification act. 3. When the legslatlon was under consideration the Secretary of War, In his letter to the President of the Senate, dated January 30, 1915, pointed out that the subject matter was under invtslgation by the Commission on Industrial Relations ; that the matter was of such importance that it should be dealt with directly and only after careful investigation and consideration ; and that legis- lation of this character should await the result of such Investigation and de- termination. Following these representations the provision was stricken out In the passage of the bill through the Senate, but it was reinstated In con- ference. It further appears that the fortification bill was not reported to the House until February 20, 1915, and did not pass that body until February 23, 1915, 12 days after the Army bill with the prohibitive legislation stricken off had been reported to the Senate. As no attempt was made to Include a similar prohibition in the fortification bill, it may be assumed that Congress only In- tended to provide for a limited application of the prohibition, in vew of the arguments presented for and aganst the " Taylor system." I do not think, therefore, that the legislation is to be regarded as an expression of the policy of Congress that the system should be prohibited In all Government work, and it must be assumed that it was understood in Congress that without similar legislation in the foritflcation bill the department would be free to apply tlie system to appropriations contained In that bill. Moreover, In the absence of positive regulation by law the manner of carrying on the Government work Is one which, under our form of Government, rests with the executive department ; and when the law does not control the executive department there can be no obligation, either legally or ethically, to extend the limitations of special legis- lation to matters not within its terms. Having in view the circumstances at- tending the enactment of the provisions in question, and the terms of the same, I am of opinion that the question whether or not the " Taylor system " should be , applied to manufacturing work carried on under the provisions of the fortifica- tion act is one which is within the discretion of the Secretary of War, and that In the exercise of this discretion he is in no way bound, either morally or legally, by the limitations provided for with reference to the appropriations in the Army appropriation act, E. H. Ckowdee, Judge Advocate General. METHOD 01" DIEECTING WORK OP GOVEENMENT EMPLOYEES. 223 June 29, 1915. Hon. LiNDLEY M. Gaerison, Secretary of War, Washington, D. G. My Deak Sir: In response to your letter of the 24th Instant, with Inclosure of the memorandum from the Judge Advocate General relative to the scope of the legislation prohibiting time study and the premium system at Government arsenals, permit me to point out that the judge's memorandum does not treat of all the various phases presented in my communication of May 4, 1915, vyhich have a bearing on the attitude that should be assumed by your department in deciding whether or not time study and the premium system should be allowed to be continued at the Watertown Arsenal. I trust before deciding this important question you will find time to read my statement of May 4 in its entirety, although it is lengthy. The points which have apparently not been considered by the Judge Advocate General in reaching his decision are in part the following : 1. That the discontinuance of time study and the premium system at all arsenals between the date of the passage of the Army bill by the House and its final passage by Congress was ostensibly intended to convey to the workmen and to Congress what would take place if the clause prohibiting these features were left in the Army bill. 2. That the letters from your office to Senators and the Military Affairs Committee of the Senate indicated that if they allowed the clause to remain in the bill, it would prevent time study and the premium payments for at least one year in your department. 3. That the debate in the Senate by both proponents and opponents indi- cated there was no doubt but that if the clause in the Army bill were retained it would end time study and premium payments in all the arsenals for at least one year. 4. That the Senate rejected the clause before the conference reinstated it by the narrow votes of 29 to 31 and 27 to 38. In view of these manifestations from the department it was felt unnecessary to Include the same clause in all other appropriation bills, since if the depart- ment really Vanted to evade this instruction of Congress it could save sufficient money from the previous fortifications appropriation bill to meet the expense of premiums. The Arniy bill was the one bill applying to your department that was the most far reaching. That is why it was selected in preference to others. The Chief of Ordnance has intimated that the purpose of the clause was mis- understood by the Senate, claiming that the impression was that some one stood over the workmen with a stop watch in his hand continuously. This could not have been so, because that very point was explained correctly on the Senate floor by Senator Weeks before the vote was taken. The only theory. It seems to me, upon which It could be assumed Congress did not intend to prohibit the system at Watertown to be affected by its act, is that they wanted to give the appearance of favoring " labor " without in reality doing so. We have no such admission or intimation in this case from those who voted for our legislation. The Watertown Arsenal situation was freely used in the debate, and both proponents and opponents appeared to regard the passage of the clause in the Army bill as having a direct bearing on the Watertown Arsenal system. If desired I shall be glad to try to point out more specifically the particular passages in the seven hours' debate In the Senate on the subject which support the above contentions, but to do so without it being requested would only make this letter too long. I hope it will be decided to discontinue the time study and premium system at Watertown Arsenal on and after July 1, 1915, without substituting piece- work In the machine shop in its place. Sincerely, yours, President, District No. 44, International Association of Machinists. 224 METHOD OP DIRECTING WOBK OF GOVEBKMENT EMPLOYEES. Office of the Judge AovocATr, General, M'ashinffton, July S, 1915. Memorandum for the Secretary of War : Subject : Premium system — Watertowii Arsenal. 1. The question is asked whether the accompanying statements by Mr. N. P. Allfas regarding the memorandum of this oifice of June 5, 191.5, on this- subject " make it desirable or proper to reform " the said memorandum of this office. 2. Mr. Alifas refers to certain points raised in his letter of May 4, 1915, as apparently not considered in the memorandum of this office. While the points referred to are not discussed at length in the memorandum of this office, tbey were nevertheless given consideration. These points, with the views of fliis office stated under each respectively, are as follows : (a) That the action of the department in discontinuing the "premium system at all arsenals between the date of the passage of the Army bill by the House and its final passage by Congress, was ostensibly intended to convey to the workmen and to Congress what would take place if the clause prohibiting these features were left in the Army bill." Answer. I do not think the action of the department should be construed as here stated. The subject was under consideration by Congress, and the depart- ment could not know the form that the legislation would take. As finally passed, however, it constituted simply a limitation on the expenditure of the appropriations carried in the Army act, and it can not be assumed that it was understood by Congress or by the department as having any further operation than that Included in plain import of the words used. (6) That the letters from the War Department to Congress " indicated that if they allowed the clause to remain in the bill it would prevent time study and the premium payments for at least one year," in the War Department. Answer. I think the observations under point (a) apply to this point also. At the time of the communications to Congress the legislation was under con- sideration, and the department eould not, of course, know the form which would be ultimately given to it ; or whether or not similar legislation would be Included in the fortification bill. As ultimately passed, it constituted simply a limitation on the appropriation carried by the Army bill ; and it must be as- sumed that it was so understood In accordance with the plain import of the provision by Congress as well as by the department. (o) "That the debate in the Senate by both proponents and opponents indi- cated there was no doubt but that if the clause in the Army bill were retained, it would end time study and premium payments in all the arsenals for at least one year." Answer. I do not think this is a fair inference from the discussion of the provision in its passage through Congress. On the contrary, I think it must be inferred that the provision was understood, in accordance with its plain import, as stated above, as a limitation simply on the expenditure of the appro- priations carried by the Army bill. In the report of the Chief of Ordnance, dated May 14, 1915, he refers to the fact that he discussed with the Member of the House who proposed the legislation under consideration " the point that without similar legislation on the fortifications bill, this department would be free to pay premiums out of funds appropriated in the latter bill." If it had been intended to make the legislation apply to the fortifications bill, the proper way to give effect to such Intention would have been to include a similar limitation in that bill. The failure to do so must, I think, be regarded as leaving the department full discretion with reference to the expenditure of the appropriations carried in the fortifications act. 3. The foregoing supplemental memorandum will be sufficient to show that the points referred to by Mr. Alifas were duly considered before tlie original memorandum was prepared ; and I do not, therefore, deem it desirable to re- form that memorandum. F. H. Crowder, Judge Advocate General. In vie^^• of the circumstanmes 1 will not interfere with the course of action laid down by the Chief of Ordnance in the matter. If the Congress really in- tends to abolish the merit system in all Government works under the War De- partment it can, and will say so; until then we should reward merit as best we may. U M. G. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 226 Septembeb 4, 1915. Hon. LiNDLEY M. Gakeison, Secretary of War, Washinyton, D, C. My Dear Mr. Sechetaky: Supplementing my interview witli yon on Ausrnst 30 relative to the desirability and advisability of discontinuing tbe obiectionable features of the Taylor system at the Watertown Arsenal and substituting the straight day-work plan of payment in the machine shop, at a proper rate of pay, permit me to give the following reasons why this should be done : 1. In previous communications on this subject I have endeavored to point out that the spirit of the legislation passed during last Congress relative to time study and the premium system would mean the discontinuing of the features of the Taylor system to which we have objected, if followed to its legitimate con- clusion. I sliall, however, not dwell upon that aspect of the question, but merely Inclose herewith, for your Information and reference, copies of my two previous communications to you on this subject, under dates of May 4, 101.5, and .Tune 29, 1915. I fully agree with you that your department is not bound by the literal inter- pretation of this legislation to discontinue the premium system at the Water- town Arsenal, and it has never been contended that such was the case. How- ever, the impression of our people had been for a long time previous to the passage of this legislation that if Congress once expressed its opinion of what should be done that the department would consider such an expression as binding. The scope of the legislation is such that the department is still left with the discretion of abolishing the objectionable parts of the Taylor system at the Watertown Arsenal. Everyone realizes that it is an absolute impossibility to prescribe by means of legislation all of the details of administering' the affairs of an industrial plant ; and if ofTicials of the (rovernment charged with the en- forcement of law are not in harmony with the wishes of Congress and do not intend to carry out such wishes, except In so far as compelled to, there is no way by which Congress can possibly enforce its policies concerning affairs pre- sumably under its jurisdiction. After all, the wording of any piece of legisla- tion is merely a method of transmitting the wishes of the legislative body to people in the community to whom the legislation is applied, with the expectation that the results will be the same as though those who are affected by the legis- lation had the same desire as did the legislators when they passed the law. The Instances in which this desire has not been carried out are numerous, due to the inability of legislators to properly circumscribe their thoughts by means of language. Cases in point are regulations regarding the sale of liquor and laws restricting the employment of child labor. There may be some excuse for private individuals to evade the law when some one else, namely, the courts. Interpret such law; but in the case of a department of the United States Government who to a large extent interprets laws applied to itself, I submit that the Interpretation should be more liberal. The ability of the people to secure the passage of laws and the reasonable enforcement of the same is about the only bulwark that stands between peace, harmony, and respect for law on the one hand, and war, revolution, and anarchy on the other. 2. The Taylor system is a scheme of ultraindustrial efficiency, built up with a certain object in view. This object was clearly made known by its author, Mr. Frederick W. Taylor, in his work entitled " Shop management," at a time when it was not necessary for him to carry favor with the public or to gloss over or moderate his language to make it acceptable to the public or to working people ; but it was given to a body of manufacturers in a way which presumably Mr. Taylor thought would appeal to them. The circumstances under which this treatise was written, therefore, makes it unusually valuable as a means of learning the true purpose and real intent of the Taylor system. Our principal objections to the Taylor system are as follows : (a) The elemental time study, which has for its object the ascertaining of the maximum amount of work a good workman is able to do. (&) The paying of premiums, as one of the numerous incentives for spurring the workmen on to extraordinary exertions. (c) The strict system of discipline necessary to enforce a complicated work- shop scheme which is so intricate ithat everybody must be compelled to strictly " toe the mark," in order that everything may go like clockwork. 36162—16 15 226 METHOD or DIKECTING WOEK OP GOVERNMENT EMPLOYEES. (d) The substituting of a low grade of workmen for the sliilled workmen em- ployed under other systems of shop management with the accompanying condi- - tion of paying lower wages. The Taylor system partially makes up for the lowering of the wage scale incidental to the hiring of a cheaper grade of work- men by the premium he receives. (0) The disagreeableness imposed upon each workman of having eight differ- ent bosses to goad him along, instead of one boss as ordinarily is the case. (/) The gradual weeding out of less skilled workmen who can not keep up to the extraordinary high pace set. If this policy were carried out by all private employers, a man who was not a first-class workman would have no place on earth ; and he would either have to fight for a right to work or be " Oslerized " to put him out of his misery. (p) The di.ssatisf action caused among the workmen due to the impossibility of making a reliable time study of work in the machine shop, because of the impossibility of maintaining standard conditions. Materials vary In hardness ; tools vary in their temper, accuracy, and general fitness ; and different machines vary greatly in their efficiency and adaptability. The results attained by one woi-kman are also determined to a large extent by the efficiency and promptness with which he is assisted and cooperated with by other workmen. All of this pro- duces in the minds of the workmen a chronic state of dissatisfaction, since the time study and the extent of his earnings through the premium system are largely based upon pei-fect conditions. The entire treatise on " shop management " by Mr. Taylor bristles with ex- pressions of the desirability of speeding up workmen, discharging all but first- class men, drastic discipline, paying as little as the law of supply and demand compels, and giving workmen object lessons of what happens if they do not com- ply with orders ; in other words, making the workshop a veritable inferno. I do not contend that these results and conditions apparently desired by in- dustrial managers have been as yet attained at the Watertown Arsenal. How- ever, the machinery Is all there for putting them into effect at an opportune time. Our objections to time study are not based upon the use of the stop watch as such but upon the purpose for which time study is Intended and the ulti- mate goal to be attained. By way of illustration, our objections to time study might be likened to the attitude your department might assume if it was learned that the Imperial .Tapanese Government intended to send a fleet of war vessels to the Hawaiian Islands for the purpose of establishing a base of sun- plies and operations. Even though the United States were assured tliat any strategical advantage thus gained would not be used against it, an effort would be made to stop any foreign fleet from landing there, especially, if you had learned th.nt the real purpose of securing a base of operations was to Invade tlie United States. The sending of a fleet of war vessels from .Tapan to the Hawaiian Island would be a perfectly peaceful operation provided what they intended to do after they got there was peaceful ; liliewise the making of a time study would not l)e objected to if the results of it were not intended for an objectionable purpose. In order that you may see from actual quotations from " Shop management " by Mr. Taylor that the above conclusions are correct as regards the purposes of this system, I append hereto a number of extracts taken from that treatise. Our reason for selecting the time study and the premium system as special objects of attack is that these are the features upon which all the rest of the harrowing details of the Taylor system are based. Our objection to the Taylor system will not cease with the elimination of the time study and the premium system if other means are devised for securing the same re.sults. What we desire to prevent is this intensive scheme of production with its extraordinary stimulus to the activities of the workmen. 3. During my conversation with you on August 30 you made the very reason- able observation that it is possible to outline a theoretically perfect scheme for settling almost any troublesome situation, such as the difficulties in Mexico, provided the element of human nature is not taken into consideration and cer- tain premises are assumed. The Taylor-system scheme miglit look very beautiful to the manufacturer or Industrial manager whose only desire Is increased productivity and greater profits; but in our opinion this scheme will not work because it has not taken into consideration the element of human nature. Mr. Taylor in devising his scheme did not take into consideration whether or not the American workman would in the long run submit to that sort of treatment ; and if the American METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. 227 workman will not do that his scheme will not work any more than the finest scheme yet devised for settling the troubles in Mexico. As an evidence of tlie attitude of the American workmen, I desire to merely call your attention to tlie following: (o) That at the last four conventions of the American Federation of Labor the Taylor system has been denounced as vicious and unfit to be imposed upon tlie Americ.in workmen and something to be fought to extermination. (6) That practically every labor organization in the United States has es- pres.sed its unalterable opposition to it. (c) That the employees in the Government service have maintained an atti- tude of uninterrupted opposition to this scheme ever since its inauguration. Numerous petitions and complaints have been received from the employees at the Watertown Arsenal, the object of which has been to secure the abolition of the Taylor system. I merely call your attention to these matters to show that the element of human nature has not been taken into considerartion by Mr. Taylor in devis- ing his scheme, and unless it is possible to secure the cooperation of the work- men to some extent this scheme can not work ultimately. I know that you are too sensible and wise in the ways of the world to attempt the impossible and to allow a course to be pursued in your department that is meeting more opposition every day. 4. The system in operation in the arsenals previous to the inauguration of the Taylor system made ample provision for rewarding workmen paid by the day in accordance with their efficiency. At the Hock Island Arsenal, for in- stance, the vs-orkmen are rated as to efficiency semiannually, and adjustments in wages are made in accordance with these findings. For the machinists a wage scale exists ranging from .$2.75 to ■1i4 per day, in five grades. The lati- tude for toolraakers is from §3.50 to .$4.59, in four grades. This, together with the power of discharge and the process of selection which has been going on through the civil service and otherwise to secure a high grade of workmen, we believe is ample to secure from the workmen a reasonable day's work. If more than a reasonable day's- work is expected, and a scheme is inaugurated to secure that result, naturally we are opposed to it. It has been contended that the Government of necessity would always be a good employer, and that oppressive laboring conditions will never be attempted because oflicials of the Ordnance Department have not sufficient incentive to induce them to introduce onerous and oppressive workshop conditions. Permit me to point out that within tlie last few months the Frankford Arsenal ma- chinists receiving .$3.24 on all of a given grade of work have been displaced by men receiving .$2.24 per day. At least one of these men who was receiving ^3.24 was given the option of being discharged or accepting the same work at $2.24 per day. At the Rock Island Arsenal laborers have iDeen known to have been reduced from $1.75 to $1.60 per day. To a workingman this sort of process looks like oppression, and the very thing we are fighting against. The Ordnance Department is no respecter of per.sons. What they would do to a laborer in offering him $1.60 per day they would also do to a mechanic getting $4 per day if it were possible. Such evidences as the above of what would happen if it were enforceable leads the workmen to believe that it is necessary to prevent the inauguration of such schemes as the Taylor system, whicli readily lends itself to such activities. Permit me to also point out that in the hearings before the special committee of the House of Representatives investigating the Taylor system the Chief of C>rdnance was unable to see anything drastic or objectionable about this scheme as outlined in Mr. Taylor's " Shop management." He also stated, on page 1167 of the hearings, as follows : "Anything that produces permanent dissatisfaction and discontent would be given up. We desire to have our relations with the workmen harmonious." Inasmuch as the four years of opposition to the Taylor system by the workmen at the Watertown Arsenal, which opposition has in- cluded not only threatened strikes but actual strikes — and at the present time the situation is in its most critical stage — does not, in the opinion of the Chief of Ordnance, require the elimination of this system, then the conception that the Chief of Ordnance lias of what constitutes satisfaction and harmony differs materially from ours. 5. Much of the economy that has been effected at the Watertown Arsenal and attributed to the Taylor system has been due to the increase in the equipment of tools and facilities for expediting the work, the introduction of high-speed steel, the use of materials that had previously been charged to other work and 228 METHOD OF DIEECTING WORK OP GOVERNMENT EMPLOYEES. that Since the introduction of the Taylor system have been collected and used without being charged to the work, the scheme for issuing materials and ac- counting for the same, the routlng-of-work system, and the better arrangement of the machinery. All of these things have produced efhciency and economy and are not a necessary part of any system the objectionable part of which is the abnormal speeding up of workmen. . 6 While individual increases have been given at the Watertown Arsenal since the inauguration of the Taylor system, the scale of wages has not been in- creased; that is, it runs no higher than $3.52 per day, which has been the maximum for years. At the present time the wage scale in private establish- ments in the vicinity of the Watertown Arsenal is much higher than this, and a iijuterial increase should be given the machinists at this time. In fact, we V'lifve that the scale at the present time is so much below what it should be llml the present maximum should be made the minimum, and the proposed maximum should be as high as $4.48. Ostensibly the premium system pays the men more wages than they otherwise would get, but it usually has the effect of holding down the rate per day, probably due to the expectation on the part of the employer that the premium a workman makes, added to his daily wage, will satisfy him. , ,.^. The employees have waited a long time, Mr. Secretary, for the abolition of the Taylor system, and we have endeavored to employ peaceful means through- out. Almost everyone who has participated in the matter has agreed with us, excepting the Ordnance Office itself, and we hope that after you have given this matter your personal and serious consideration you will also agree with us. We do not think it a disgrace for a public official to come to the conclusion that a mistaken policy has been pursued by his subordinates who are intrusted with certain important functions, and I feel that if you will discontinue the Taylor system it will not only be a matter of gratification to you in years to come and an action for which the great body of people in this country will honor and revere your name, but it will make the employees in the Government service feel that at least one official of the War Department is interested in their personal welfare and willing to give them a square deal. This in turn will induce them to go at their work with a good will and result in a degree of productivity that is in accord with what should reasonably be expected of them. Hoping that you will soon be able to arrive at a favorable decision, and trusting to be advised of your conclusion in this very important matter, I beg to remain. Very sincerely, yours. President District No. Jii, International Association o/ Machinists. War Depaktment, Washington, January S, 1916. Mr. N. P. AirFAS, Naval Lodge Hall, Washington, D. C. My Dear Sir : I have been able to find sufficient time to go through the mass of material concerning the matter of scientific management at Watertown Arsenal to reach a conclusion upon the specific matter before me, but I have not had nearly enough time to study the subject so as to reach conclusions with respect to any broader aspects thereof. ' The specific question which you have put to me, as I understand it, Is whether I shall discontinue the methods of scientific management iu vogue at Watertown Arsenal. I have reached the conclusion that it would not be wise for me at this time to do so. If the Congress of the United States regulates this matter by law, then there is nothing open for discussion, and the law will be absolutely abided by in letter and spirit. I do not agree with your suggestion that because legislation already prohibits certain things with respect to one appropriation a similar prohibition should have been annexed by the department itself to other appro- priations. I think Congress will express Its intention in the proper way and that until it has done so the department should proceed along what it conceives to be wise lines. With respect to this matter of scientific management, it Is conceded by all those who have studied it that the theory is unobjectionable, that its practical operation requires experience to work out the best results for labor and society. It Is very well expressed in one of the reports of the Commission on Industrial Relations : METHOD OF DIEECTING WOKK OF GOVEKNMENT EMPLOYEES. 229 " In so far, then, as scientific management offers opportunity for lower costs and increased production without adding to the burden of the workers in exhaustive effort, long hours, or inferior working conditions, it creates the possibility of very real and substantial benefits to labor and to society." There is no, evidence before me that the scientific management in effect at Watertown Arsenal adds " to the burden of the workers in exhaustive effort, long hours, or inferior working conditions." I do not, therefore, feel (hat I should determine this question by ordering the abolishment of the scientific management now in vogue there. As I said to you in conversation, I feel that the proper way to treat the matter is to have it carefully investigated with a view of seeing that justice and fairness prevail and that a proper system, fair to the Government and to the workers, is devised and operated. I will do everything proper and possible to this end. I do not think I should foreclose the matter in the way suggested by ordering the abolishment of the present system, which, so far as I know, has not been shown to have any of the detrimental effects above referred to. Sincerely yours, LiNDLET M. GAEKISON, Secretary of War. Mr. Van Dyke. There is much difference of opinion, however, as to whether or not clarsified civil service employees have the right to strike against the Government, is there not? Mr. Alifas. In the Postal Service it is iDrohibited; but in the arse- nals and navy yards there is no direct prohibition of law to prevent a strike. The law provides that no one is allowed to request an em- ployee to break his contract with the Government. It is a question whether or not a man working by the day, and subject to discharge at any moment, is under a contract to work for the Government. He is under no contract to work any longer than he chooses to work, so you are not really asking him to break a binding contract. Mr. Van Dyke. I wanted to bring that out to show where the dif- ference was between the employee paid by the day and a man under contract with the Government. There is a difference, you know, in their attitude toward the Government, and the Government differen- tiates between the postal employee and the man who works by the day in the shops. Mr. Alifas. Yes ; the prohibition in different divisions of the serv- ice was based on different theories. The prohibition for the postal employees is based on obstructing the mails; and the prohibition in Government arsenals is based on the supposition, as I recollect it, that the Government is likely to be in trouble at any time ; and in the event of pending trouble it is illegal -to ask an enaployee to break his contract with the Government, although employers of labor have been doing that for the last year and a half. These munition manu- facturers nave gone to the arsenals and have taken away scores of men. They secured, I am informed, about 150 machinists at the Frankford Arsenal last fall, and offered them higher pay. Of course, that has not been objected to by the War Department officials. In fact, the War Department officials have not objected to Army officers leaving the service for the purpose of getting lucrative positions from munition manufacturers. Mr. Van Dyke. Of course, there is a different position existing in the Postal Service entirely. I do not believe they would have the right to strike. Mr. Alifas. No ; postal employees have not a legal right to strike. Mr. Nolan. Without any prohibition, or even before they were classified in the civil service, have not strikes in the Government plants been very rare ? 230 METHOD OF DIHECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. Alifas. Yes; they have been very rare. I know of but two in recent years. One was at Watertown, the one you speak of, among the molders; and the other was at Eock Island, 111., about 10 years ago. We have had a number of small disturbances that were akin to strikes, but there were no actual legalized ftrikes; that is, no strikes that had received the sanction of the grand lodge of the labor asso- ciations. There were spasmodic and independent. Mr. Nolan. Well, in the strike at the Rock Island Arsenal of the molders, did they not immediately return to work, on the assurance being given that their grievances would be taken up? Mr. Alifas. At the Watertown Arsenal, you mean? Mr. Nolan. Yes. Mr. Alifas. Yes. Mr. Keating. Before you get away from that, Mr. Alifas, do you know the total number of men in the Watertown Arsenal affected by the Taylor system? Mr. Alifas. There are about 600 men employed there, and they are all subject to it, more or less. They are not working at it con- tinuously, but they are practically all under the system, and are likely to work at it at any time. Mr. Keating. What proportion of those men do you represent? Mr. Alifas. I represent about one-third of them. I represent all of the machinists there. Mr. Keating. Are the other 400 under organized labor? Mr. Alifas. The great bulk of them; yes, sir. Mr. Keating. Have they protested ? Mr. Alifas. Yes, sir ; they have all protested. Mr. Keating. So that the majority of the 600 men affected have protested against the system ? Mr. Alifas. Yes, sir ; and even the attempt of the Chief of Ord- nance last year to induce them to protest against the stoppage of the premium system did not have that effect. They did not protest against it; they were in favor of the proposed legislation. Mr. Nolan. Did Gen. Crozier, Chief of the Ordnance Department, put into effect a similar order in Watertown to the one he put in Mr. Alifas. In fact, he put the order into effect at Watertown be- fore he had the order placed at Frankford. The order was placed on the bulletin boards at the Watertown Arsenal on January 25, 1915. That was three days after the bill passed the House; and on January 27 it was placed on the bulletin boards at the Frankford Arsenal. Now, this legislation the department afterwards claimed did not apply to Watertown, but apparently at that time the Chief of Ordnance believed it applied to Watertown, because he put it into effect there first. In fact, he made the order effective in the place where he afterwards claimed it did not apply, before he placed it in effect where he afterwards aclmowledged it did apply. Mr. Keating. Do you Icnow of any attempt being made to circulate a petition in the Watertown Arsenal? Mr. Alifas. At this time ? Mr. Keating. No ; at the time the order was placed. Mr. Alifas. At the Watertown Arsenal? Mr. Keating. Yes. Mr. Alifas. No, sir; there was no attempt made, as I recollect now, by the management at the Watertown Arsenal to get out any METHOD OP DIHECTING WOBK OP GOVEKNMENT EMPLOYEES. 231 petition, but that apparently was done at Frankford. My informa- tion is that the petition was drafted by the commanding officer of the Frankford Arsenal and circulated in the shops by some of the fore- men, mostly among nonunion employees, who did not understand the question that was before Congress ; and who were also under a mis- apprehension as to what the effects were going to be, as was brought out here the other day by Mr. Keating in pross-examination. With regard to the effects of these systems of shop management, for illustration, I would like to read a few extracts from the pub- lished testimony of and investigation held in England. In 1909 there was an investigation made of the premium and bonus system by the Trades Union Congress of Great Britain, and this volume contains extracts from testimony by workmen who had worked under it against the system. I would like to read to you two extracts. One is on pages 18 and 19, and the other is on pages 34 and 35 : Another member of the A. S. E. gave further evidence. He was a marker-ofC In the erection of gun mountings and had worked five years on P. B., previous to which lie had done the same work on time rates. He preferred the latter, and considered it impossible to fix an accurate time basis for erecting work, because of the inevitable variations in machine-work finish. The time fixed was based on the estimated number of hours a man would take to do a particular job, but these estimates were often wide of the mark. For example, In trimming seat- ing:s for training motors 1,500 hours was allowed. A slight alteration took place which reduced the fitted surface by 2 inches superficial and the time allow- ance was cut down to 800 hours. This was not an extreme case, and the wit- ness instanced another case in which a job had been cut from 1,325 to 800 hours. The time of apprentices who worked with journeymen was always cal- culated separately, and lads were supposed to do work In six-tenths of the time allowed a journeyman and, as a rule, they received double their weekly rate of pay. The employment of a lad was no advantage to a jouriieyman, except in his last year, and then only when the apprentice was kept to the work he had been accustomed to, and the way in which both man and lad were speeded up prevented the former teaching and the latter acquiring an all-round knowledge of his trade. No automatic jobs had been introduced to his department, con- sequently there had been no justification for the continual cutting of prices to which they were being continually subjected. This constant alteration. In- variably in the same direction, had resulted in constant bickering between workmen and the rate fixers. He had known frequent cases In which an alteration of the drawing number had been held to justify a reduction in the time allowance. The difference in his wages was some 4 or 5 shillings per week and he had a higher rate than the ordinary fitter. He would willingly sacrifice that sum If he could return to day work ; he would be free from the harrassing which continually went on and more men would be employed. He certainly was of opinion that apprentices were not so well trained under the P. B. system as under time conditions. Another member of the A. S. E. stated he had worked at Messrs. Vickers' for two and a half years on time and nine years on premium bonus. He was a fitter on the detail bench. He much preferred time work. His opinion of the P. B. system was that it was detrimental to the workers, as it brought one man into individual competition with his fellows. The class of work was certainly deteriorating, as It was impossible to turn out so good a job under this as under the time system. They had to rush from morning until night, and this did not conduce to good workmanship. He received on the average 7 shillings per week more than on time rates. He did not think it possible to fix accurate time allowances for fitters, as there was great diversity in the condition in which work left the machines for which no provision whatever was made They could appeal to the chief rate fixer, but no notice was ever taken of their protests. With regard to the effect of this system on unemployment he was of opinion that the number of hands had been reduced by at least 50 per cent as a direct result of the introduction of this system. A good deal de- pended on the foreman, who could use his influence with the rate fixer to ob- tain an extension of the time allowances, and this was frequently done. He had 232 METHOD OP DIEECTING WOEK OF GOVEENMENT EMPLOYEES. known cases of jobs being cut down by one-third, the only justification for this reduction being the issue of a different drawing and a different order number. There were also cases in which foremen had asked men to hurry a job out for some special reason without a time card and the time would be the same as previously allowed. The time fixer had then appeared with a time allowance much less than the workman had been led to expect. With regard to casual labor the witness had seen men sent home at 10 minutes past 6 in the morning and at 20 minutes to 5 at night ; when a job was completed and there was not another immediately ready the man was sent home. In his department the system was fairly popular, as it was well organized and they had a sym- pathetic foreman. His views were against the continuance of this system, not on personal grounds, because he was doing fairly well under it, but because of the effect he knew it had on the general body of workmen. Another member of the same society, a brass turner, had been employed at Elswick for 12 years prior to January, 1904. He had been under the feed-and- speed system, against which he had little complaint to make. One feed-and- speed overseer had five or .six shops to overlook, and in many cases his super- \i«:ion was only nominal. In 1904, however, the P. B. s>stenj wu.s introduced, and they were subjected to close and continual supervision. He was on small work and had as many as 1.5 and 10 sejjarate jobs in one day, each one having its own time allowance attached. AVhen the system was introtluced the time allowances were fixed by the feed-and-speed men, who reckoned what time the j.ib could be done in and added one-third. The basis hud, however, been changed, and now if 1.5 hours was given as a basis allowance and they did it in 12 hours they received time and quarter. In order to cut prices they would take the same job to another shop ami give a basis time allowance of 12 hours, and to earn time and quarter the workmen would have to do it in 9 hours. This system had been so developed that shops v.'eve competing one against the other as if they represented rival firms, the foremen of each shop having to put estimates in for most of the work now done by the firm. Under the old system of day work six men would be employe V *3 g If "S o a^ 5-00 enow ecior-..H 03 o) 03 ca 03 H>^-<»=i3 NMMM M 3SS I>1>00 HI c r- a. 00 N BN "J OJ «oi>- --co tH O) OSOSOJ -M* l«^ V- ^'J cc a;c4oo coca'c-' X <*3 O^ '^ ■^ ■ OW c> lO to - CD O 00 -w oom O>co co'co' co'co" O^ 09 OS 03 ffl S ® 03 l> n- -1"03 t^C- o>oi ec 01(00 T-l 30SO I- C-OaOi o t ^ OOf-i SSp rNOsociocccO'^-s'cow K 00 CD '3 00 "* 00 C» +J •I I CJ i .a 240 METHOD OF DIRECTING WOBK OP GOVERNMENT EMPLOYEES. n 1 I 51, -I •gs « u S ao5 cSOeO CCXOO a ; oe4 So s ; eqc3 ■3: >C QO OOOi ■ .. -^ mo3 "V a ^d -on U3 Oi • ^»eQ ;s so sn sssgsss^sasgs'^ssss^g^srr-^ssss a a a u 2 S i I ■§ ^ So g a a I ^ •§ - i sit; § s i I I 1 1 u «"■ -9 '2 S u ■? •? ■§ a eg* "2 •s = s &!! Bow "!»§ SCO W O oj c " ^ 5 x S >» a> a) E^ «J3ja o SEhE^K METHOD 01'' DIRECTING WOKK OE ClOVEENMEN T EMPLOVJiBS. 241 Manufaotvro of artillery aiiiiiiunllion, Statement of total arsenal costs and total contract costs for ammunition being manufactured at the Frankford Arsenal and provided for in orders issued betioeen July 1, 1912, and Apr. 35, IH13, an(l which will be completed by June 30, ISlJf. [Extract from testimony of Brig. Gen. William Crozier on Dec. 15, 1913, before subcommittee of House Committee on Appropriations on the tortiflcations appropriation bill. See p. 149 ot hearings.] Quan- Total Con- tities arsenal Aggregate tract Contract Total Saving Articles. under costs total arse- price cost per coniraet over con- manu- per nal cost. per unit. cost. tract cost. facture. unit. unit. 3-inch finished shrapnel cases. . . 3.8 finished shrapnel cases 10,000 $1.75 517,500.00 83.06 S3. 15 831,500.00 314,000.00 1,000 4.68 4,680.00 6.65 6.85 6,850.00 2,170.00 6-inch finisned shrapnel cases. . . 4,035 17.10 68,998.50 16.00 16.48 66,496.80 2,501.70 3-inch common shrapnel with- out fuses or base charges 48,000 3.55 170,400.00 6.79 5.96 286,080.00 115,680.00 3.8-inch common slu-apnel with- out fuses or base charges 4,500 7.94 35, 730. 00 17.50 18.03 81,135.00 45,405.00 4.7-inch common shrapnel with- out fuses or base charges 14,500 15.45 224,025.00 26.26 26.02 377,290.00 163,265.00 6-inch common shrapnel with- out fuses or base charges 21-second combination fuses 5,000 30.20 151,000.00 37.00 38.11 190,550.00 39,550.00 48,000 2.16 103,680.00 4.30 4.43 212,640.00 108,960.00 31-second combination fuses 26,500 2.92 77,380.00 17.00 7.21 191,065.00 113,685.00 3-inch nigh explosive shrapnel, fixed 45,000 74,500 10.15 456, 750. 00 2 13. 17 592,650.00 184,016.00 135,900.00 60,346.00 Fuse stocks 1.66 123,670.00 2.40 2.47 74,500 74,500 .18 13,410.00 6,705.00 .23 .2369 17,649.05 13,044.95 4,239.05 6,339.95 .09 .17 .1751 ' This was the lowest and only bid received, but no contract was made. 2 The shrapnel projectiles only were ordered abroad, and the contract cost includes the cost of assem- bling the projectile to the cartridge case and charge and of the necessary rounds for firing test based on a previous order. Grand total contract cost $2, 250, 965. 80 Grand total arsenal cost 1, 453, 928. 50 Saying 797,037.30 Purchase of artillery ammunition — Statement of total contract costs and of total arsenal costs for ammunition being purchased from outside manufacturers covered by orders given between July 1, 1912, and Apr. 25, 1913, and which will be delivered before June SO, 1914. [Extract from testimony ot Brig. Gen. William Crozier on Deo. 15, 1913, before subcommittee of House Committee on Appropriations on the fortifications appropriation bill. See p. 150 of hearings.] Articles. 2.95-inch shrapnel case forglngs 3-inch slirapnel case forgings 3.8-inch fimshed shrapnel cases 4.7-inch finished shrapnel cases 6-inch finished shrapnel cases 3.S-inch common shrapnel without fuses or base charges 4.7-inch common shrapnel without fuses or base charges 6-inch common shrapnel without fuses or base charges 3-inch common steel shell 3.8-inch common steel shell 4.7-inch common steel sheU 6-inoh common steel sheU 3-inch fixed high-explosive shrapnel. Quan- tities dered. 4,109 25, 523 7,055 9,615 5,760 2,500 7,000 1,600 3,000 9,066 10 605 7,077 10,000 Con- tract price per unit. S3. 06 3.06 6.65 9.37 16,00 17.50 25,26 37.00 4,87 9.17 12,46 17.93 13,17 Con- tract cost per unit. S3, IS 3.15 6.85 9.66 16.-48 18.03 26.02 38.11 5.02 9.45 12.83 18.47 13.17 Total con- tract cost, S12,943.35 80,397.45 48,326.75 92, 784. 75 94,294.80 45, 075. 00 182,140.00 57, 165. 00 15,060.00 85, 673, 70 136 06', 15 130,712.00 131,700.00 Total per unit. $1.75 1.75 17.10 7.94 15,45 30.20 2.39 4,81 8,30 16,75 10.15 Total arse- nal cost. S7, 190. 75 44,665.25 33,017,40 84,612,00 98, 496, 00 19,.850. 00 108,150.00 45,300.00 7,170,00 43, 607. 46 88, on, 50 118,639.75 101,600.00 Contract cost over arsenal cost. 15,752.00 35,732.20 15,309.36 8, 172. 76 4,201.20 25,22^.00 73,990.00 11, 865. OO 7,890.00 42,066.24 48 040.66 12,172.26 30,2001,00 $1, 112, 334. 95 800,120.11 I^gs ■' 312,214.84 Grand total contract cost . Grand total arsenal cost. . . ;!s:i62— 10- -16 242 METHOD OF DIKECTING WOEK OF GOVERNMENT EMPLOYEES. The first of these tables relates to work at the Rock Island Arsenal, where the features of the system to Avhich we object had not been introduced up to that time. It shows, for instance, that a 3-inch gun carriage which costs under contract, in lots of 16, $3,398.82 each, when manufactured in lots of 20 at the Rock Island Arsenal were manufactured for $2,192.27. This shows a saving of over $1,000 in favor of arsenal costs. The same showing can be duplicated in a large number of cases in this table. With a showing of that kind I submit to this committee that a necessity does not exist for speeding up the workmen any more. The other two tables relate to work done at the Frankford Ar- senal, where, however, the premium system has been in operation for a number of years in part, although that is substantially the only part of the Taylor system that they have used there. Since the prohibition against the premium system in last year's Army appropriation bill the management at the Frankford Arsenal has transferred all premium workers to piecework, and I under- stand that the work is costing about the same. However, the show- ing made in cost of doing work according to these two tables is largely the result of what is generally termed " common-sense man- agement " as against " scientific management." In spite of this favor- able showing as to costs of doing work at the Frankford Arsenal we have been led to believe that this is also one of the arsenals into which it is proposed to introduce the Taylor system. At any rate, I desire to emphasize to this committee that this favorable showing as to costs at the Frankford Arsenal is not the result of the Taylor system, since the piecework plan, which is unscientific according to Mr. Taylor, operates equally well and economically. Many people in the United States seem to think that Government jobs are usually sinecui-es. This impression, I presume, dates back to the time when most Government jobs were under the spoils sys- tem. Since then, however, the civil-service law has been in operation. Employees at the arsenals and navy yards have gone through the experience of having one set of officers take charge after another, with the result that each set of officers have attempted to make a record for themselves, oftentimes by making the workmen work harder. As a result of this, if there ever has been any inefficiency in these establishments the slack has been taken out long ago, when it is considered that they change officers in many places as frequently as every two and one-half years or even of tener. In the arsenals it is not quite so frequently ; perhaps every four years. This brings me to the other point that I desire to make. It has been contended by officials at the Ordnance Department that Army officers have no incentive for introducing oppressive measures or unduly speeding up the workmen. This might be true if they ex- pected to always be employed as Army officers, but from time to time these officers who have gained experience as managers of the department's industrial plants are offered good positions with pri- vate manufacturers. Any officer, therefore, who has ambitions to secure a managerial position at a ^ood salary with a private concern would have a very powerful incentive to operate a Government plant as efficiently as it could be operated and to make the workmen work just as hard as they could be induced to work. At least the em- ployees to a large extent are impressed with the belief that the offl- METHOD OF DIRKCTING WORK OF GOVERNMENT EMPLOYEES. 243 cials are principal!;^ concerned with the quantity and quality of production and discipline among the workmen to the exclusion of the personal interests of the employees. In conclusion, I desire to emphasize the fact that the opponents of the proposed legislation during the last few days have admitted that the Taylor system and similar sy^stems are based on the law of " the survival of the fittest " and that in setting wages and standards of performances the law of supply and demand must operate. Under these circumstances it seems to me this committee can do nothing other than disapprove the introduction of these systems in Government workshops, and I hope that every effort will be made by this committee to secure the passage of the pending bill. I thank the committee for the privilege of appearing before them and for their considerate attention. STATEMENT OF MR. EDWARD J. CANTWELL, SECRETARY NA- TIONAL ASSOCIATION OF LETTER CARRIERS, WASHINGTON, D. C. Mr. CAMTWEii,. Mr. Chairman and members of the Committee on Labor, I come before you to-day to enter my protest against the stop- watch or time-measuring device system in vogue in the Postal Service and to urge the committe to carefully weigh all the evidence that will be submitted to them in the hope that they will make a favorable report to the House of Representatives on a bill that will stop this practice in the future. For the information of the committee, I submit herewith a memo- randum of the speed standard and the result of a test made in the Cincinnati post office. The statement contains an explanation of the number of pieces of mail per minute that letter carriers are required to distribute and the time allowances made for handling registered mail, C. O. D. parcels, insured parcels, postage-due mail, and answering communications. Also the time allowed for per- forming other classes of work, such as change of addresses or mark- ing up mail matter that has not been properljr distributed, and as this is something that will explain itself, and with the permission of the committee, I will insert it in the record. Mr. Keating. Without objection, it will be inserted. (The statement referred to is as follows :) SPEED STANDAED. After making time allowances as noted below, carriers sliould distribute the number of pieces per minute indicated in the following tables : Two-trip carriers. 'J'lu'ee-trip carrier's. Four and five trip carriers. I'ei'cent- Pieces. PercenV Pieces. Percent- ' Pieces. age. age. age, 10 13 10 14 10 16 15 12i 16 m 15 15i 20 12 20 13 20 15 25 114 25 1?1 25 14i 30 11 30 12 30 14 35 lOi 35 m 35 il^ 40 10 40 11 40 13 45 H 45 105 45 m 50 9 50 10 50 12 00 « CO 9i 244 METHOD OF DIRECTING WORK OE GOVERNMENT EMPLOYEES. Under "papers" Is Included everything except letters, circulars, and cards, time allo\\'ances should be made as follows : One minute per piece for registered mail, C. O. D. parcels, insured parcels, postage-due mail, and communications; one-half minute for each change of address order written up; one minute for each seven pieces marked up. To ai-rive at the rate of sjieed, make proper deductions from the total office time on account of " time allowances '■' and divide the number of pieces of mail of all classes handled by the number which represents the net number of min- utes of office time. For example, a two-trip carrier whose total office time amounts to 1 hour and 31 minutes handles 800 pieces of mail, 35 per cent of which is classed as papers ; he handles 2 registered pieces, 1 postage-due piece, answers one communication, and marks up for forwarding 77 pieces and enters 4 orders. Making proper deduction for " time allowances " in accordance with above table his net office time is 91 minutes less 17 minutes. Dividing 800 by 74 we get 10.8 which shows the average number of pieces handled per minute and which should be compared with the above table. Many carriers should be able to exceed the rates of speed indicated in the above table and no carrier should fall below the requirements. It can not be supposed that all of the carrier force can sustain their work at the standard fixed by the department, and for this reason there will be routes which are not served according to these standards. Those carriers who can not serve a standard route should be assigned to routes at those outlying stations where they would serve routes in accordance with their abilities, and these assign- ments should carry a less salary than that paid men serving standard routes. For instance, if it is found after a thorough test that any carrier is unable to conform to the departmental standards of work, he should if receiving the maxi- mum salary be reduced in salary on the grounds of inefficiency, and assigned to a station where undertime according to the standard of work is unavoidable. On October 14, 1915, a test was made of 210 carriers in the Cin- cinnati post office, divided as follows: Foity-six six-trip carriers; 10 five-trip carrieis; 30 four-trip car- riers, 31 three-trip carriers, and 93 two-trip carriers. Out of a total of 210 men, 130 fell below the standard in this test. Of the six-trip carriers, 23 measured up to the standard and 22 fell below it. Five trippers, 2 carriers made the standard and 8 fell below; of the four trippers, 4 men made the standard and 26 fell below; of the three trippers, 8 measured up to the standard and 23 fell below; of the two trippers, 43 made the standard and 50 fell below; of the total number, 80 carriers measured up to the speed test of the de- partment and 130 fell below. Of the test taken on Friday, October 15, 1915, out of a total of 206 men but 72 measured up to the standard and 134 fell below the standard. I submit herewith, for the information of the committee, the results of the speed test taken on both days. (The statements referred to are as follows:) CINCINNATI, OHIO. Result of speed test taken on Thursday, Oct. 14, 1915. [Number of carriers covered bv test 210; forty-six 6-trip carriers; tpn 5-trip caiTlers; thirty 4-tiip carriers; tbirty-one 3-trip carriers; and nlnety-.tbree 2-trip carriers.) Number of trips. Number it cards, letters, Jirculars. Number otber classes. ^^umber of Reg. Ins. C.O.D. ^^umber postage due. Com- munica- tions an- swered. Orders backed. For- warded marked up. 6 68,716 10,382 26.691 21,159 42,642 5,256 1,068 4,247 ■ 5,528 13,486 191 12 32 56 70 363 48 84 34 3 2 ■( 6 33 20 46 101 123 4,346 600 1,831 2,209 4,237 6. 4 3 2 Total 169,490 29, 674 360 .W9 16 323 13,223 METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 245 TaWc ■•ilKjwiiifi tiiiie consniiied (icticiUii. [First column, time allowance according to wei,i;lits given in standard table, second column, and time Stter allowances are deducted and bv which the averages are computed are shown in the third column. Time computed in minutes.] Number of trips. Actual time. Allow- ances. Time. Average. Number of men. 6 5,810 1,102 2,900 2,848 6,125 1,195 158 402 458 805 4,615 944 2,498 2,390 5,320 16 12.1 12.3 11.1 10.5 46 5 10 4 30 3 31 2 93 Total 18, 785 3,018 15,767 12.6 210 Note.— Fifty-six men, five and six trippers, averaged 15.3, standard 16; 30 fom-trippers averaged 12.3, standard 15.5; 31 three-trippers averaged 11.1, standard 13; 93 two-trippers averaged 10.5, standard is U.S. Out of a total of 210 men, 130 fell below standard. Talile shmpinff the nmnber of men in cnvh, elass iclio attained the standard. 6 trippers. . 5 trippers. . 4 trippers. . 3 trippers. . 2 trippers. . Total Standard or better. 80 Lower than standard. 130 Total. 10 30 31 93 CINCINKATI, OHIO. Result of speed test taken on Friday, Oct. 15, 1015. [Number of carriers covered by test 206; forty-four 6-trip carriers; nine 5-trip carriers; twenty-eight 4-trip carriers; thirty-four 3-trip carriers; and ninety-one 2-trip carriers.! Number of trips. Number of cards, letters, circulars. Number of other classes. Number ■ of Reg. ins. u. 0. d. Number of com- mimica^ tions answered. Number of orders booked. For- warded marked up. Postage due. 6 70,619 9,772 27,399 25,369 45, 442 6,216 1,290 6,003 8,828 17,643 241 16 55 46 87 15 5 20 66 90 4,212 1,599 2,173 3,161 5,015 341 5.. 1 1 5 7 70 4 65 3 34 2 82 Total 178,601 39, 880 445 14 196 15, 160 692 Table showing the time consumed. (First column shows the actual time, second column shows time allowances, and the third shows the time after the allowances have been deducted, and by which the averages are arrived at. Time is shown in minutes. J Number of trips. Actual time. Allow- ances. Time. Average. Number of men. 6 5,747 1,052 3,152 3,709 7,233 1,190 174 441 569 937 4,557 878 2,711 3,240 6,196 16.8 12.5 12.3 10.5 10.3 44 9 28 3 34 91 20,893 3,311 17,682 12.4 206 Note — Forty-tour 6-trippers averaged 16.8, 10 per cent of papers standard demanded 16; nine 5-trippers averaged 12 5, 10 per cent of papers standard demanded 16; twenty-eight 4-trippers averaged 12.3, 20 per cent papers, standard demanded 15; thii-ty-four 3-trippers averaged 10.5, 25 per cent papers standard demands 12 5; ninety-one 2-trippers averaged 10.1, 35 per cent papers, standard demands 10.5. Out of a total ot 206 men 134 fell below the standard. 246 METHOD OF DIEECTING WOEK OF GOVEENMENT EMPLOYEIES Tabic shomnr/ the number of men in eaeh class who attained the standard. 6-trippers. . 6-trippers. . 4-trippers. . 3-trippers. . ^•trippers. . Total Standard or better. Lower than standard. 134 Total. 34 91 206 In the speed tests an allowance of one minute is made for answering communications. It hardly seems reasonable to suppose that any man could answer a communication from his superior officer in one minute. In answering an official communication it must be drawn up intelligently and contain the information sought by the official and couched in respectful language. I will leave for the committee to judge whether there is one among us who could pick up an official document requesting a reply, read it, and make an intelligent answer in writing in the space of one mine. For example, the superintendent of a post office hands an official communiciition to a letter carrier reading as follows : Complaint is made by Mr. Edward Keating, formerly of Congress Hall, that his mail is being left at that address, although he filed an order to forward his mail to the Continental Hotel. On receipt of this communication, the carrier must first ascer- tain if the accusation be true. He knows that for the past several days he has forwarded Mr. Keating's mail to the Continental Hotel, and he further knows that the order to forward is only 3 days old, so he calls at Congress Hall and inquires if he, by any chance, left a letter for Mr. Keating at any time, and is told by "the clerk that a letter was left for Mr. Keating on the morning of the day that he left the hotel, and that he had sent one of the employees to the Con- tinental Hotel the next day with the letter. Mr. Keating had not filed a removal notice until the day following his removal from Congress Hall, hence at the time the letter was delivered at Congress Hall no order was on file to forward his mail. This must be made clear to the superintendent, so the carrier writes him as follows: ii,r r< ^ TT T^ March 30. 1916. Mr. Carl C. Van Dyke, Superintendent of Mails, Washington, D. C. Sie: Replying to the attached communication, I beg to advise that I have forwarded all mail addressed to Mr. Keating to the Continental Hotel as per order since the order was received by me, but prior to the filing of the order and after he left Congress Hall a letter was delivered there for Mr Keating which was later taken by an employee and delivered to the Continental HotS! Respectfully submitted. .Tames P. Mahkr, Cnrrier ),96. This answer is intended to make it clear to Mr. Keating that his mail IS receiving the proper attention, and explains the reason the delivery ot the letter to him by the employee of the Congress Hall Hotel was due to his failure to file a removal notice until the day after he had left. Now, anything less than this would not answer die purpose, and no man living could write, the above in one minute. What I mean by that is that he could not take that official commimi cation, read it, and find out what the assistant superintendent wanted METHOD OF DIRECTING WOBK OF GOVEBNMENT EMPLOYEES. 247 to loiow, and then compose a letter and answer it in one minute's time. One-half minute is allowed for change of address, which is not sufficient for the purpose, unless a letter carrier can make all the changes of address from memory and not be compelled to consult his removal book. Should a letter carrier make a change of address from memory and forward a letter to the wrong address the letter is de- layed, and the carrier is disciplined by having demerits charged against his record. To mark up and forward seven pieces of mail per minute depends entirely on the character of the marking up. If it is simply to mark the number of the district on which the letter is to be delivered, seven pieces of mail could be readily marked up in one minute. If, however, one or more pieces of mail requires looking up in an order or removal book, it would be a physical impossibility to mark up seven pieces of mail in one minute. For the further information of the committee, I submit herewith a copj[ of a communication issued to the post-office clerks and letter carriers of Chicago, 111., of the speed tests required of the employees in that city. (The letter referred to is as follows:) Post Office, Chicago, III., Delivery Division, January 29, 1915. Circular No. 7. Subject : Rating of clerks and carriers. Superintendents of stations : Superintendents of stations will submit as soon as possible, in C. P. O. Form 3990, efficiency ratings for all clerks and carriers assigned to tbeir respective stations on the quantity and quality of work performed during the year end- ing November 30, 1914. The next efficiency ratings following the above will be given for the six months from December 1, 1914, to May 31, 1915, and shall be submitted here- after semiannually, December 1 and June 1, respectively, on C. P. O. Form 3990. The efficiency rating of each employee from December 1, 1914, on shall be determined on his record for attendance, adaptability, speed, accuracy, and efficiency, and the relative value of each subject shall be charged as follows: Points. Perfect in attendance, one-fifth point off for each day absent 14 Perfect in adaptability 12 Adaptability of clerks shall be determined by their availability for any clerical duty, application, appearance, and courtesy. Adaptability of carriers shall be determined by periodical tests as to the manner in which they memorize removals and dispose of their "overs"; their application, general appearance, and courtesy in the office and in the field. Maximum in speed, 12 points. To be giyen as follows : Clerk distributing — 50 cards per minute on examination 12 45 cards per minute on examination 11 40 cards per minute on examination 10 35 cards per minute on examination 9 30 cards per minute on examination 8 25 cards per minute on examination 6 20 cards per minute on examination 3 16 cards per minute on examination (but qualifies) Carriers routing and trying out on exclusive : Firm districts — 40 pieces per minute on test 12 35 pieces per minute on test 11 30 pieces per minute on test 8 25 pieces per minute on test 5 20 pieces per minute on test 2 Under 20 pieces per minute on test ^48 METIEOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. Garriers routing and trying out on exclusive — Continued : Office-building districts — -„ 35 pieces per minute on test ^ 30 pieces per minute on test ■'■J 25 pieces per minute on test ° 20 pieces per minute on test ^ 17 pices per minute on test ^ Under 17 pieces per minute on test Mixed business and residence districts — 25 pieces per minute on test 12 23 pieces per minute on test ij 20 pieces per minute on test " 17 pieces per minue in test 8 15 pieces per minute on test . 2 Under 15 pieces per minute on test Tlu-ee-trip residence districts — 20 pieces per minute on test 12 19 pieces per minute on test H 17 pieces per minute on test 9 15 pieces per minute on test 6 13 pieces per minute on test 2 Under 13 pieces per minute on test Two-trip residence districts — 18 pieces per minute on. test 12 17 pieces per minute on test - 11 16 pieres per minute on test 9 15 pieces per minute on test 7 14 pieces per minute on test 5 12 pieces per minute on test 2 Tender 12 pieces per minvite on test Accurate observance of tlie working schedule by carriers, 12 points. To be determined liy weekly periods for first trip in each month of the year. Where a carrier averages schedule leaving and returning on first trip for each weekly period he shall receive 12 points. For an average of each minute excess of the scliedule as outlined above he shall lose one-half of a point. Accuracy in the distribution of mail by clerks, 12 points. Standard for maximum points, 99.50 per cent correct on ca.se examination : 99.50 per cent correct 12 99 per cent correct 11 98.50 per cent correct 10 98 per cent correct 9 97.50 per cent correct 7 97 per cent correct 5 96 per cent correct ^^ 3 95 per cent correct (but qualifies) Perfection in all of the above subjects shall entitle an employee to 50 points on efficiency, and the net result would give an emplovee an eflficiency rating of 100. For example, should an employee's record and service be such that it would earn him 13.80 points for attendance, 11 points for adaptability, 11 points for speed, 11 points for accuracy, the points earned for efl^ciency would be 47, or a sum total of 93.80 points, which would be the rating earned. All clerks assigned to stations, except those who are engaged entirely in cage work, nuist be examined on distribution and assigned to the distribu- tion of mail upon receipt of each dispatch. Cage clerks who perform no dis- tribution shall be rated on speed and accuracy, in accordance with the superin- tendent's judgment and observation as to their ability to perform the duties assigned them. Le Roy T. Stewabd, SuiicriiitcHdcnt of Delivery. The pace set in these tests is beyond the physical and mental en- durance of an ordinary man, and if lived up to would result in the 'breaking down under the strain of any human Ibeing. The tests could possibly be made by a man of extraordinary ability and train- METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 249 ing for a period of 1 hour when a man is at his best. No ordinary man could stand the pace and maintain all the requirements set out in the rules and regulations covering these speed tests. The system has a tendency to make mere machines of men and to destroy all initiative and to have them lose personal interest in their Avork. This system destroys harmony of effort and cooperation between the offi- cials and tiie working forces und with resultant hnrm to the puljlic service. It seems to me to be poor policy on the part of the Gov- ernment to institute a system among its emplo}rees that takes away from them the incentive to take pride in their worlc. It is carrying the policy of economy to extremes and has the tendency to foster discontent and unrest among the men who do the real hard work. I will now cite a condition that prevails in the postal service that to my mind is without, justification or excuse. I have presented to the committee copies of the department's speed standard, which in themselves are worthy of the serious thought and consideration of the members of the committee. The strain incident to keeping up with this so-called standard of efficiency is heartbreaking in the extreme, but the condition of the employees is aggravated by what is termed "the secret tests." Each carrier is subjected to this so- called speed test on one day of each month, the day and date being unknown to the carrier and the testing being secretly made. The purpose of these secret speed tests is to keep all the men working at top speed mentally and physically every minut* each day. as the carriers do not know what day they are being tested. On the daj^ a carrier is subjected to the test, I have been informed, inspectors secretly count the pieces of mail of all classes that the employee handles th;it <. on the Van Dyke or Tavenner bills, with a recommendation to the Congress that it be enacted into law. Mr. Van Dyke. With your permission, I would like to ask you a few questions relative to the Postal Service, because I have to attend another subcommittee meeting. I ask you these cjuestions simply to clear up a condition of mind that seems to exist through the country. I have here the Engineering Magazine for April, which goes on to give this bill and then says : A similar liill introduced by ( lonprressniaii A'aii Dylie nii tlie siime per cent because of the " two-division " plan. Scientific management, I heard some of the speakers say in the past few days, contemplates giviug the workers a share in the profits to some extent, because it makes them more capable of earning larger salaries. Now, we in the Postal Service have absolutely no such hope, working as we are, having an institution that is, by its very nature, and always will be by its verj^ nature, a governmental mo- nopoly, there is no possible hope of the men doing this distribution, or doing the delivering of mail, or doing any of the other necessary arduous tasks — there is no possible chance for them to share in any bonus, or to share in any profits that may accrue from the conduct of the department. There is no possible chance for them to share in any surplus that their efforts might bring forth. As a matter of fact, and this is interesting, the Postmaster General, in his report to the Sixty-third Congress, said with pride that the Post Office De- partment was, for the first time since Benjamin Franklin's era, on a self-sustaining basis, and that a surplus of $4,000,000 had accrued. Possibly there are some business institutions making $4,000,000 for the first time, following years and years of steady deficits, that would have been so encouraged that they avouIcI have attempted to encourage the employees by proposing some share in these profits. But what did the Postmaster General do ? He went to Congress and asked that the eight-hour law be amended to read, instead of 8 in 10, to read 8 in 12, so that the day's work could be spread over 10 hours. He asked that the Sunday rest law be abrogated. A man working Sun- day is allowed compensatory time off on one of the following six days ; so we are assured relief from toil one day in seven. He asked that the rate of pay for substitutes, and this substitute service is the most — I can scarcely find words to describe it; that is, words that would be suitable in the record. It is a period of precarious living, it is a period that tries men's souls. As Mr. Cantwell said, a great many of the men get out of the service. There is a turning over every 10 years in the service, due to a great extent to the fact that the men. get soured on the service during the first years of their substitute period. These substitutes earn, for the most part, they average at any rate, around $30 a month. They are paid at the rate of 35 and 40 cents per hour, and yet the Postmaster General, following a $4,000,000 surplus, asked that their wages be reduced from 35 and 40 cents an hour, to 30 cents. He asked that our promotions, which are now annual, be made biennial, or every second year. Thus you see every bit. of remedial legislation that we employees have been able to place upon the statute books during these seven or eight years of 266 METHOD OF DIHECTING WOBK OF GOVEBNMENT EMPLOYEES. hard and incessant work was to be wiped away all at one session, following a year when the department showed, with a great deal of glee, I think, a $4,000,000 surplus. Mr. Smith. From what particular branch of the department is the largest part of that received — can you tell ? Mr. Flaherty. No; but, Mr. Smith, this is true of the Postal Service. The only revenue-producing portion of the service is the handling of the first-class mail, you understand, the 2-cent letter. There is an enormous deficit in second-class mail matter. The de- partment gets 1 cent a pound revenue, and its costs about 7 or 8 cents to handle it. Mr. Smith. What I had particularly in mind was whether there is a considerable saving from the rural carriers. Mr. Flaherty. No; I think the rural service is expensive, but I am fully convinced that it makes this up in a great many other ways. Mr. Smith. The chairman stated that there was a saving of some $40,000 in my own district up in Michigan that is represented by Mr. Beakes, I think, by the readjustment, and I wondered if that would go through all the districts. Mr. Flaherty. The department makes no effort to separate into various units the different pai'ts of the service in endeavoring to find out which is the revenue producer. They take this view, that while a city like Chicago will show, and it does show, a $20,000,000 surplus — that is, thtir revenue is 20,000,000 in excess of their ex- penditures — still, a letter mailed in Chicago and a stamp bought there and mailed to somewhere in Michigan or elsewhere gets service on a rural route, from which route, of course, none of the revenue is credited and none of the revenue goes, t is difficult to determine just where the revenue or the surplus accrued, but I do know that the men in the service do their share in producing it, and I do know that that was the first year that the eight-hour law went into effect. Mr. Smith. Have you any information or have you learned that there is a disposition to eliminate all the postmasters in a county except one, and have all the other offices except that county seat, we will say, for instance, carried on and conducted by the assistant postmaster ? Mr. Flaherty. I will say that this legislation which passed the Senate, which was, however, rejected by the House Post Roads Com- mittee previously, would permit the Postmaster General to abolish every office but one in a county and therefore eliminate the post- masters. Mr. Smith. Do you know whether that bill is in conference now ? Mr. Flaherty. Yes ; it is about to go to conference. Mr. Smith. That would be a big saving there. Mr. Flaherty. There would be a sa\ing in the salaries of the i!>ost- masters, undoubtedly; yes. The previous speaker spoke of the Borah bill, which was introduced in the Senate, and I am pleased to be able to state that it was at my solicitation Senator Borah intro- duced that bill. I regret, as I think we all regret very much, that he was suddenly taken ill and was unable to be on the Senate floor the morning our bill came up. Previous to that Senator Borah who had made considerable study of this stop-watch and scientific management, introduced a bill prohibiting its use in the Government service entirely. The time test was then in existence in the Railway METHOD OF DIEECTINO WOBK OF GOVERNMENT EMPLOYEES. 267 Mail Service, and the railway mail clerks from all over the country sent in petitions to Mr. Borah thanking him for introducing the bill and giving it their unqualified indorsement. Alexander H. Stevens, superintendent of the Eaihvay Mail Service, in a speech at Indianapolis to a body of railway mail clerks, told them in effect that he had the power and the inclination to dismiss from the service any man who would send to Mr. Borah a petition or a request that such legislation be enacted. Mr. Borah took the fight of these rail- Avay mail clerks to fhe floor of the Senate, and in a scathing speech denounced the bureaucratic methods of Mr. Stevens. It was due to that speech, I believe, rather than to any feelings of the department, that the stop watch was abolislied, or the time test was abolished in the Eailway Mail Service. The department did not abolish it because of any regard for the health or well-being of the railway mail clerks. If they had that thought, they would have abolished it throughout the service. But the Borah speech, I believe, brought so much publicity and so much odium upon the system, that they thought best, for the time being at least, to eliminate it. I have no further remarks to make, imless the members of the committee have any questions in mind. Mr. Nolan. I do not know whether I got it from information, or whether I read it in a newspaper, but about a year ago I read that they were going to introduce skates in the Chicago post office for all the clerks. Is there any truth in that report ? Mr. Flaherty. They have already put skates on the boys who ore down in the room where they check wardrobes. The Chicago office is so crowded they had to do away with the lockers downstairs, in order to give more room for the distribution cases. When a man goes to work now in the Chicago office, he goes in and hands his lunch basket, if he has one, and his overcoat, if he has one, to a clerk behind the counter, and the clerk hands him a check in return, and skates down about 30 or 40 feet, and hangs up the luggage. The idea was that he would save time in going to and from the counter and ranging up the clerks' coats and hats. Mr. Keating. We thank you very much, Mr. Flaherty, and if there are no further witnesses, the committee will adjourn until Tuesday morning, at 10 o'clock, when it is expected Mr. Frye will be here to testify. (Whereupon the committee adjourned). Committee on Laboe, House of Eepresentatives, Tuesday, April 4, 1916. The committee met at 10 o'clock a. m., Hon. Edward Keating pre- siding. Mr. Keating. We will hear first this morning from Mr. Eich- ards. STATEMENT OF MR. WILLIS B. RICHARDS, 43 WALL STREET, NEW YORK, REPRESENTING GTJNN, RICHARDS & CO. Mr. EiCHARDS. Mr. Chairman, I want to start with a word as to how I happened to be here. In the first place, on December 1, or very shortly after that, I re- ceived a circular of the Society to Promote the Science of Manage- 268 METHOD OF DIRECTING WOKK OF GOVERNMENT EMPLOYEES. ment, the headquarters of the president of which are at Hanover, N. PI., which reads as follows: Society to Promote the Science of Management, Office of the Pkesidbnt, Hanover, N. H., December 1, 1915. Dear Sib :— During the session of 1914-15 strong efforts were made to In- duce Congress to pass legislation prohibiting time studies and premium pay- ments in Government establishments and in private concerns manufacturing for the government. Their efforts resulted in the passage of the so-called Dietrick amendment to the Army appropriation bill. This legislation was not as effective as its proponents Intended, and will undoubtedly be followed dur- ing the present session of Congress by stronger efforts to secure more com- plete prohibitive legislation. In the belief that such legislation would result in " turning back the wheels of progress," with respect to possible economies of production, not only In Government, but also in many private concerns, a meeting has been called to consider the desirability and means of presenting to Members of Congress and to the public a full, accurate, and impartial explanation of the nature of time, study, and premium payments, and of the situation in Government and other plants where these have been established. This meeting will be at 2.30 p. m., Friday, December 10, Engineering Societies' Building, room 5, 29 West Thirty-ninth Street, New York City. You are earnestly invites- mg the productivity of the worker to a considerable extent? Mr. Richards. That is necessary to the increase of his earnings. Mr. Nolan. Because as production is increased, and as this system is installed generally it tends to increase the productivity of workers in every line of industry to a great extent, is that not likely to be followed by the laving off of a goodly number of men? Mr. Richards. Not unless that section of the country was boarded up so that the product could not get out. Mr. Nolan. Suppose we take normal times, and not abnormal times, when production is increased to a considerable extent under this system, would that not mean the laying off of a goodly number of workers in industry? Mr. Richards. It would be very hard to answer that. I would like to say yes, because you evidently expect me to. It fluctuates so that the volume of any one trade rises and falls according to the demand, but I do not think that will be the history here. Mr. Nolan. Why do you make provision under your system for greater earnings for a number of men in industry," so that, as you say, they might have a better wage or better salaries in order that they may better take care of their families? Is anv thought given to the man who is shoved cut of employment, or to his family? Mr. Richards. To answer the first part of the question— Why do we do this — I say it is to stimulate production, of course. In the operation of the ordinary premium plan we do net necessarily shove out a man who does hot earn a premium, but in anv line of busi- ness there is nrthing in the world that will hold a poor man in his job if the employer dees not want him. Mr. Nolan. I am not particularly asking this question concern- ing the poor man. In stimulating prcduction you stimulate it largely when you go through a factorv with your scientific manage- ment? Mr. RiciiARns. Yes. Mr. Nolan. If there is only a certain amount of work to bo done in industry, and one individual can accomplish 50 per cent more under scientific management than he could formerly accomplish under the old system, it necessarily means the layin^ off of a lar^e number of workers? '^ " Mr. Richards. Yes. METHOD OF DIRECTING WOEK OP GOVERNMENT EMPLOYEES. 281 Mr. Nolan. Yon are nol concerned iibout that end of it? Mr. EicHARDs. No. In cur position ■we are not the employers. We are only advising the employer. Mr. Nolan. I wanted to bring that out in connection with your statement that you are not expected to play the part of the Good Samaritan with your client's money. Mr. Richards. There you have it. Mr. Nolan. You are net giving any ccnsider.ition to the ultimate effect of scientific management as applied generally to industry in this countrj' — that is, as to what will become of the surplus labor that is put upon the labor market after scientific management is generally applied. That is net a part of your system? You do not give any thought to that? Mr. EiCHAEDS. No. We might be employed by a client to give at- tention to that very thing ; but we have not been, and we would not expect to be. Mr. Nolan. Under scientific management — have you taken up that proposition at all? Have you given any thought to it? Mr. EiCHAEDS. We have not had occasion to. Mr. Nolan. You heard seme of the gentlemen who were here opposing this measure, who are efficiency engineers; j'ou heard them testify that it was a case of the survival of the fittest. Do you sub- scribe to that doctrine? Mr. Richards. Always, everywhere. Mr. Nolan. No matter what the ultimate effect might be upon society ? Mr. Richards. I do not think that can be overcome. Mr. Nolan. You give no consideration to that at all? Mr. Richards. I would not put it that way. Mr. Nolan. I understood from your statement a moment ago that as an efficiency engineer you are not called upon to solve that problem. Mr. Richards. No. I say we would not expect to be employed to solve that problem. A manufacturer might employ us for that pur- pose, and in that case we would serve him gladly. Mr. Nolan. In demonstrating scientific management, do you take that up with the employer and discuss it with him ? Mr. Richards. Yes, sir ; but there has not been any occasion to do that lately, because labor has been pretty fully employed. Mr. Nolan. Let us go back a few years. Let us go back to tlie latter part of 1907, and from that time up until 1913. During that time there was a great period of unemployment in this country, and scientific management was in vogue at that time. You were applying the system to industry at that time, were you not? Mr. Richards. Certainly. Mr. Nolan. Then you did have a period when there was a great surplus in the labor market, a great number of unemployed, and the problem at that time was to find employment for those people. Many communities in this country had given thought to that in the way of raising funds to provide work, and in some instances they even fed the men. Did the efficiency engineers give any thought to tlie welfare of those people at that time? Mr. Richards. Our office did not. 282 METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. Nolan. Do you know of any concern which demonstrates this system of scientific management that did do that? Mr. EiciiAnns. No; I do not. Mr. Nolan. Do you employ time study men? Mr. EiCHAiiDs. No. Mr. Nolan. Do you furnish them to the manufacturers? Mr. EiciiARDS. We have net liad occasion to do that. Mr. Nolan. Do you use a stop watch in your business? Mr. RicpL\RDS. Very little. Mr. Nolan. Do you know anything about the training of time studying men who are studying to qualify for future positions of that kind? Mr. EiCHAEDS. Yes. Mr. Nolan. Will you give the committee an idea of what that training is? Mr. KiciiAEDS. It is not very intricate. It is a mere matter of cal- culating, sometimes through a very short period, the capacity of a machine and the efforts of the man who is working on the machine, and sometimes that is done over quite a little period of time. From that is calculated what might be expected from that group of men, or from a man and his helper working on a machine, and in the absence of any better information, it is a good basis. It is a necessary basis for establishing what might be termed the measure of a man's ability. Mr. Nolan. It is quite an important position, is it not, to take time studies and make observations? Mr. EiCHARDS. No. It is generally done by juniors. Mr. Nolan. Then you do not consider it necessary to have a high class, practical man to take a stopwatch and make the observations necessary to get the correct time? Mr. EiCHARDS. I should not consider it was necessary. Mr. Nolan. In that connection, have you run across, in the appli- cation of the stop-watch and in the matter of time studies, any serious mistakes on the part of the man who makes those studies, whom you say need not be a very high class man ? Have you run across any in- stances where such men have made serious mistakes? Mr. EiCHARDS. I do not remember of an instance of that sort. We have done very little of it. Mr. Nolan. Do you know whether time-study men generally are trained to make complete studies of the human element involved? Mr. EiCHARDS. Mr. Valentine was on our staff for sometime. Mr. Valentine practically makes a business of that. Mr. Nolan. You do not know, Mr. Eichards, in any way whether the time study mentioned generally, which the efficiency engineers are making, includes fatigue studies? Mr. EiCHARDS. I do not understand they do. I do not know any- thing about it, Mr. Nolan. We do not. Mr. Nolan. You do not? Mr. EiCHARDS. No. Mr. Nolan. Did it ever occur to you that these fatigue studies would be essential to the success of this system eventually ? Mr. EiCHARDS. You realize that you are speaking of a system that we are not jiracticing. We are not, you understand, installing what is known as the Taylor system, but we would not object to it and have not seen any reason to object to it. METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. 283 Mr. Nolan. I understood you to make the statement here, Mr. Eichards, that you did not consider the stop watch a very important factor in scientific management. Mr. EicHAEDS. We do not. Mr. Nolan. You heard the statement of gentlemen here that it was absolutely necessary to have it, did you not? * Mr. KiCHAEDs. If that is so, I do not agree with them. Mr. Nolan. In proceeding along this line of inquiry, Mr. Chair- man, I want to be understood as not objecting to individuals or or- ganizations in tMs country seeking to use what I consider their rights and prerogatives in petitioning Congress, either direct or through other organizations, and circularizing the country. I do not know but that it is a pretty good thing to have that right. I want to ask some questions of Mr. Eichards about something that has transpired here in relation to soliciting funds. Mr. Nolan. You have testified here that you were selected as one of the committee of ten. Mr. Eichards. Yes, sir. Mr. Nolan. And were designated to solicit funds for that com- mittee. Mr. EiCHAEDS. Yes, sir. Mr. Nolan. Were the men who attended that meeting mostly all efficiency engineers or men that were engaged in the business of scientific management? Mr. Eichards. No. Mr. Nolan. Were there any organizations of employers? Mr. Eichards. There were a great many employers. Mr. Nolan. Were there any organizations of employers repre- sented ? Mr. Eichards. No. Mr. Nolan. Have you had charge of the sending out of letters, Mr. Eichards, from your office? Mr. Eichards. Yes, sir. Mr. Nolan. All of the letters ? Mr. Eichards. Yes, sir. Mr. Nolan. How many letters requesting funds have been sent out? Mr. Eichards. About 500. Mr. Nolan. Did you consider any particular line in sending them out? Did you pick out individuals or were suggestions made to you regarding how they should be sent ? — Mr. Eichards. We got a list somewhere ; I do not remember where it came from. Mr. Nolan. Did it come from the National Association of Manu- facturers ? Mr. Eichards. It did not. I would like to say right here that Mr. Emery is not retained by the committee. Mr." Nolan. Are you still sending letters out ? Mr. Eichards. We have not sent any more. Mr. Nolan. Is all the money turned into your office? Mr. Eichards. Yes. Mr. Nolan. How much money have you collected? Mr. Eichards. Three hundred and thirty-five dollars. Mr.. Nolan. Three hundred and thirty-five dollars ? 284 METHOD OF DIRECTING WOEK OF GOVEENMENT EMPLOYEES. Mr. EicHAEDS. Yes. Mr. Nolan. I have a letter here that has been incorporated in the record under date of March 21. It is on the letterhead of Glenn Eichards & Co., 43 Wall Street, and it is addressed to Mr. John W. Powell, 531 Harvard St. NW., Washington, D. C. Did you dictate that letter? • Mr. EiCHAKDS. Not each letter. Mr. Nolan. That is, the form. Mr. EiCHAEDS. Yes, sir, the general letter. Mr. Nolan. I note in the first paragraph on the second page of the letter a statement to the effect that the next step planned by the pro- ponents of this legislation is an act to restrict the Government offices from buying any materials or supplies which have been manufac- tured by any shop employing modern efficiency methods, and that, following direct legislation, both of these ends may be offered by riders on the appropriation bills, as was done at the last session. Can you tell us, Mr. Eichards, what information you have had at your command that prompted you to say that the proponents of this legislation, whcever they may be — I do not know whom you referred to — proposed to restrict the Government of the United States from buying materials or supplies which had been manufactured by any shop employing modern efficiency methods? Mr. EiCHAEDS. That was not based on any information we had. That was simply the opinion of the committee. Mr. Nolan. It states that the next step planned by the pro- ponents of this legislation is an act to restrict Mr. Eici-iAEDs (interposing). The language is unfortunate. It was simply the opinion of the committee that that would be the next step. Mr. Nolan. Did you give any thought to that language when you put it in your letter? Mr. Eichards. Certainly I did. I did not mean to purposely misstate it. Mr. Nolan. It is rather misleading, isn't it? Mr. EiCHAEDS. I realize from the point you make, that it would have been a little more fortunate if a different word had been used. Mr. Nolan. Have you any information at all that anybody con- templates introducing legislation of that character? Mr. EiCHAEDS. No, except 'that that would be the logical thing, in our judgment. Mr. Nolan. That is all. _ Mr. Keating. Do you wish to ask any questions of Mr. Eichards, Mr. Van Dyke? Mr. Van Dyke. Yes. You understand, Mr. Eichards, that I am looking for information relative to the systems that ha\-« been used and are being adopted more and more each year in the Government service. As I view this bill, of course, it has to do with Government employees. In asking some other witnesses questions along this line, they have admitted on the stand that even if the bill were passed there is nothing in the provisions of this bill which would prohibit any private employer from going ahead with his system as hereto- fore. Mr. EiCHAEDS. Certainly. METHOD OF DIRECTING WOKK OF GOVEBNMENT EMPLOYEES. 285 Mr. Van Dyke. A great deal of stress has been placed upon the methods in that branch of the Government service knoven as the navy yards and arsenals; in fact, most of our hearings have been along the line of machines and so on. You realize that the Government has a large number of employees who are not employed in those shops, but whom the provisions of this bill would affect. For in- stance, we have something like 30,000 employees in the arsenals and navy yards, and in one other branch of the service, the postal brand i. we have something like 130,000, to state the number conservatively. Do you know anything about the system employed at the present time in the postal branch of the United States? Mr. EiCHABDs. No, personally I do not. Mr. Van Dyke. They have a system there which would take in the different branches. The post-office clerks' testimony has been offered to us, where they have described galleries in the post-oiHce building through which the inspectors time the men. They also ha-\'e another system, of an overseer going up to a man who is working in the letter case and timing him as to the number of letters that he handles in a specified time, holding the watch on him and telling him to speed up; and if he has established a standard, then he is sup- posed to do as well as that or even better throughout all the rest of his eight hours' work. And every other man in the office is sup- posed to do as well as he does if he is used as the standard, as is the case in a great number of tests. What do you think of a system of that kind? Mr. Richards. I think the system is all right, but it can easily be abused. Mr. Van Dyke. You understand that the provisions of this bill aim at the abuses entirely of the system of getting the work out of an employee which he is supposed to do for the wage which he re- ceives. That, in my opinion, is the only reason why the provisions of the bill would be of any benefit at all to the employees. Mr. Richards. You realize that it does nqt seem to me that that is going to be the operation of the bill. Mr. Van Dyke. Absolutely. Mr. Richards. It is going to prohibit everything. Mr. Van Dyke. It is going to prohibit everything except a reason- able time study in the Government shops. Mr. Richards. You realize, the way the bill is worded, it would be impossible for a man to get the necessary information to even establish a cost system? Mr. Van Dyke. That is not my understanding of the bill as it was discussed at the last meeting. Mr. Richards. That is only my opinion of it. Mr. Van Dyke. Yes. Now, we have another system. We will take the Railway Mail Service branch where we have a 100 per cent effi- ciency night. They take one of the heaviest nights in the week — w& will say- Friday night — when they have the most mail, and they determine the number of men necessary to complete the distribution of that night's mail on that special run. Then they will arbitrarily fix Saturday night, which is probably a 100 per cent night; but when the mail falls off on Sunday they will place that at 60 or 60 per cent, and reduce the crew proportionately. If connections are 286 METHOD OF DIBECTING WOBK OF GOVERNMENT EMPLOYEES. missed and there is an overflow, there is a less number of naen to take care of, probably, the same volume of mail on Sunday night. But there is no opportunity to get an adequate number of men to handle the mail, consequently the public will suffer. Do you believe that an^ system of that kind is a good system, not only for the employees, but for the public in general? Mr. Richards. The way you state it, of course, I would disapprove of it. Mr. Van Dtke. Then, also, there is the systeni which probably more closely resembles your bonus system, which is called the plus and minus system — a system of rewards and demerits._ They have one way in which a man may gain 500 plus points for his record, but they have, I think it is, either five or six methods in which a man may receive 500 minus points, and 700 minus points are sufficient for dis- missal. Do you believe any system where a man can obtain in only one way 500 merit or plus points, and five or six ways in which he can obtain 500 minus points, is a fair and equitable system ? Mr. EiciiARDs. I do not think you ought to ask me that question imless I had a chance to study the system. That is entirely too intricate. Mr. Van Dyke. As a general thing, it is the same as putting into effect any kind of system. Mr. Eichards. I do not think the number of points that a man might make would have any bearing upon it. However, I would not want to answer that question without giving it some study. Mr. \ AN Dyke. If a man, as under this system, has to risk his life to obtain 500 points, or to gain 500 points, he has to defend the mail at the risk of his life and, on the other hand, gets 500 minus points for making a false statement to a superior official — do you think that is fair? Mr. Richards. That is the only way he can get a reward? Mr. Van Dyke. That is the only way he can gain 500 points. Mr. Richards. Uponthat statement, it is certainly wrong. Mr. Van Dyke. There are other reasons for supporting a bill of this character than simply giving consideration to the mel-its of the bill as it relates to private emploj'ers of the countrv. We maintain abuses in the Government service that should be rectified. Mr. Richards. That is no reason, in my mind, why you should support this bill, because this bill does not get at that at all, but it does sweep out of existence something the Government should have. Mr. Van Dyke. There is the stop watch or time-measuring sys- tem. Mr. Richards. You absolutely need some time-measuring system to get along. Mr. Van Dyke. Every man who has appeared upon the stand has cheerfully admitted that if the bill went into effect it would not affect his factory. Mr. Towne, of the Yale Manufacturing plant, stated that he could go on and continue to do business in the same way. whether this bill was passed or not. Mr. Richards. This bill does not aim at private property. Mr. Van Dyke. That is what I wanted to bring out. Mr. Keating. What industries has your firm been "standardizing,"'' if that is the correct term to use? t mean, in what industries has your firm introduced the so-called scientific management? METHOD OF DIEECTING WORK OP GOVEENMENT EMPLOYEES. 287 _ Mr. Richards. Steel plants, automobile factories, paper mills, tex- tile mills, shoes. My imagination stops there. We have had a lot of them. Mr. Keating. Are all shoe factories operating under this system? Mr. EicHARDS. I should not think so. Mr. Keatikg. You should not think so? Mr. EicHAues. No. Mr. IvEATiKG. What percentage of the shoe factories of the coun- try are under scientific management? Mr. Richards. I should not like to make a guess of greater than 15 per cent. Mr. Keating. Have the factories representing the 15 per cent adopted the same system ? Mr. Richards. Oh, flo. There are no two alike. Mr. Keating. Under scientific management there is no definite or well-defined system which must be adopted as a whole? Mr. Richards. No. Mr. Keating. In introducing the system is it the custom for em- ployers to engage engineers who have devoted study to a particular system and get them to go into their plants and standardize and •regulate the plant? Mr. Richards. I think a great many manufacturers do much the same thing without any assistance from the outside. I think Mr. Feiss testified here the other day that he had no assistance at all from the outside ; yet he has a very highly developed factory. Mr. Keating. Each employer determines for himself whether he wants to introduce a system or not? Mr. Richards. Surely. Mr. Keating. Do you know of any shoe manufacturer who is not operating under scientific management that has an efficient, well- managed factory? Mr. Richards. T do not know. Mr. Keating. Do you know of any shoe factory which is not operating under scientific management which is able to compete with those factories that are under scientific management? Mr. Richards. I said I do net know. I am not kt all sure that 1 can answer differently. You understand that the factories that do not come to us we know very little about. I think there is a factory in St. Louis which I do not believe has ever had an efficiency engineer that is making a very large number of cheap shoes; but I also understand that their loss and gain account is net very satis- factory, and they are not in very gcod standing; but they do a very large business. Mr. Keating. You would not say to this committee, however, that there were no large shoe factories in this country which were operat- ing without this so-called scientific management? Mr. Richards. I would not say there were none? Mr. Keating. Yes, sir. Mr. Richards. I certainly would not ; no, sir. Mr. Keating. There are some business men of recognized stand- ing who have achieved marked success in the business world and have succeeded in conducting his business without scientific manage- ment in competition with shops which had adopted scientific man- agement ? 288 METHOD OF DIRECTING WOEK OP GOVEBNMENT EMPLOYEE?. Mr. EiciiARDs. Yes. Mr. Keating. You appreciate that the relation between the Gov- ernment and its employees is somewhat different from the relations between the ordinary employer- and his employees? Mr. EiciiARDs. I thinii I realize that; yes. Mr. Keating. You can appreciate that the Government has a more direct interest in conserving the human maching than the ordi- nary employer has? Mr. RiCHAEDS. I do not like to say that; no. Mr. Keating. The ordinary employer has a very direct and vital interest in conserving his ordinary machinery, hasn't he? Mr. Richards. Yes, sir; certainly. Mr. Keating. He has his capital invested in that ordinary ma- chinery, hasn't he? Mr. Richards. Yes, sir; certainly. Mr. Keating. If one of his human machines were to break down and become incapacitated, he could go out into the market and get another man to replace him without increasing his capital ? Mr. Richards. Surely. Mr. Keating. But Avhen the Government loses an efficient human machine, it is short one efficient human machine, and the Govern- ment's capital is reduced thereby one efficient machine. Mr. Richards. I can not follow you on that. I can not see that the Government is not in the same position as the private employer when it comes to going out into the labor market and getting a new man. Mr. Keating. The Government has a direct interest in the well- being of its citizens, their health, their mental and physical strength. Mr. Richards. Peculiarly in relation to its manufacturing? Mr. Keating. Oh, no; in relation to its very existence. Mr. Richards. I will say " yes " to that, of course. Mr. Keating. There is no dispute about it, Mr. Richards, is there ? Mr. Richards. No. Mr. Keating. That the very existence of the Government is de- pendent upon the number of efficient citizens living under that Government ? Mr. Richards. Surely. Mr. Keating. Therefore, the Government as an employer has, in addition to the interest that the ordinary employer has in increasing the productivity of its employees, the additional interest that it wants citizens who are strong, mentally and physically, for other purposes than that of merely producing shoes, for instance. Mr. Richards. Yes. Mr. Keating. You will agree with that proposition, will you, Mr. Richards ? Mr. Richards. Certainly. Mr. Keating. Then the Government might have a very selfish interest in being something of a Good Samaritan to its employees. Mr. Richards. Yes, I think so. I think it is, as a rule. Mr. Keating. Now, Mr. Richards, the introduction of scientific management, as I understood your testimony, involves a very funda- mental change in the method of compensation of workmen, doesn't it? MEXHOD OF DIEECTING WORK OF GOVEBNMENT EMPLOYEES. 289 Mr. Richards. Yes, sir. Mr. Keating. For centuries, broadly speaking, the working man has been paid on the basis of a day's wages, and your proposition is that he shall be paid what is practically a modification of the piece system; is not that true? Mr. EiCHAEDs. Yes, an amplification of the piece system. Mr. Keating. And it involves a fundamental, what might almost be called a revolutionary, change in the system of compensating workmen, does it not ? Mr. Richards. No doubt about that. Mr. Keating. Then, as an efficiency engineer, and as a business man of experience, don't you feel that as large an employer as the United States Government should give very serious thought to the question before it imposes upon its employees a revolutionary change ? Mr. Richards. No doubt about that. Mr. Keating. As a business man, wouldn't you expect your super- intendent, if he thought that it would be a good thing to introduce this system into your plant, to come to you first and go over the whole matter with you and satisfy you that this was a good thing? Mr. Richards. Surely. Mr. Keating. You would not approve the conduct of a superin- tendent who introduced the system first and then came to you and asked you to examine into the merits of the system, would you ? Mr. Richards. Not in a situation like you suppose. If I was the owner of the business, I should expect him, of course, to consult me. Mr. Keating. That is the situation as we see it. Here is the United States Government, with hundreds of thousands of employees, and it is proposed to introduce this sj'^stem without serious considerar tion by Congress as to the advisability of introducing the system. Don't you think that before the system is introduced Congress, the law-making power, the power that controls the purse strings of the Nation, should have an opportunity to consider the system and deter- mine whether this revolutionary change should be made ? Mr. Richards. Not if you have given that responsibility to some- body else. Mr. Keating. Suppose we had not given that responsibility to somebody else? Mr. Richards. I would say he had exceeded his authority, then. Mr. Browne. What do you know of the Engineering Magazine? What magazine is that ? Mr. Richards. Why, it is a very prominent magazine devoted ex- clusively to engineering. Mr. Browne. Why I ask you that question is this: I noticed an article in there which took exception to a bill introduced by me deal- ing with the conditions in the Postal Service of the country. I have, whenever I have been in the committee room here, endeavored to find out just what the different opponents of this bill, which is sub- stantially the same as the one I have just referred to, knew of what 1 count the abuses in the Postal Service, and I have not yet been able to find anybody who has made a study of the system used. Mr. Richards. Of course. Price, Waterhouse & Co., and Deloitte, Plender, Griffith & Co., made a study of this system, but they prob- 36162—16 19 290 METHOD OP DIRECTING WORK OF GOVEBITMENT EMPLOYEES. ably did not have a better knowledge than anybody else which would enable them to criticise it. Mr. Browne. That is why I ask you to say whether you had made a study of the system in the Postal Service. Mr. Richards. I have not. Mr. Browne. This magazine objects strongly to the bill I intro- duced, and I was wondering whether the editor of that magazine had made a study of it or not. Mr. EiCHARDs. He might have had access to the information gathered by Price, Waterhouse & Co., and Deloitte's or their sources of information. They did not make a report upon the operation of the post ofSce. Mr. Keating. Would it be possible for an employer to use the so-called efficiency system in such a way as to oppress his employees? Mr. Richards. Yes, Mr. Keating, if he could force his employees to work for him. He can not do that ; so I must say " no." At least nothing we practice or install is anything more than a tempta- tion to the man to work. Mr. Keating. You are speaking of your own system? Mr. Richards. We have not any system beyond the system that is developed under our advice. Mr. Keating. Are there any two engineers who adopt the same system ? Mr. Richards. I doubt it. No two engineers have a chance to work on the same problem. No two lawyers are both on the same side of a case, and if they were, they would not have the same views. Mr. Keating. In the matter of compensating an employee for the extra work he may do, this so-called bonus system is merely an effort to stimulate the employee? Mr. Richards. Surely. Mr. Keating. Have any two engineers the same formula for bringing that about? Mr. Richards. No two engineers of our staff ever have the same formula. Mr. KJ5ATING. Outside your organization? Mr. Richards. Outside our organization, no two engineers would follow our mental operations as a rule. Mr. Keating. You said, in the matter of the eight shoes, that the workman that made the ninth shoe would receive a dollar and a half. Mr. Richards. Surely. Mr. Keating. Gen. Crozier figured that on an increase of 274 per cent in efficiency the man got 33^ per cent increase in salary. Mr. Richards. That is quite a reflection upon the efficiency of the Government workmen. Mr. Keating. It would seem so. Mr. Richards. I do not think that is an exaggeration. I think that is more or less true. Mr. Keating. Would it be fair when the employee's output in- creases 274 per cent, that his salary should be increased only 33^ per cent? Mr. Richards. If he was so inefficient previously to that time that would be fair ; yes. ' METHOD OF DIRECTING WOEK OF GOVEKNMENT EMPLOYEES. 291 Mr. Keating. In offering that as an example, Gen. Crozier did not offer it as an example of unusual inefficiency, but as a fair ex- ample of results of scientific management. Mr. Richards. That is true ; but when you offer a stimulus in the Government employ, you will find that much betterment. That shows that the work pre\ious to that time was performed at a very slack percentage. However, I am talking about something that I don't know anything about. I have never been in an arsenal. Mr. Keating. Do you believe it is possible by offering bonuses to oyerstimulate the workman so that he will draw unreasonably upon, his mental and physical resources? Mr. EiCHAEDS. It does not ordinarily happen. I can not imagine it would be possible. He can do that when he is in control of his own work, work himself to the point where he can not work any longer. Mr. Keating. If it were shown by actual experience that the offer- ing of bonuses and premiums did cause a workman to so exert him- self, in order to earn an extra compensation, that he did injure him- self mentally and physically, would you be willing to accept that testimony ? Mr. Richards. Yes, of course. Mr. Keating. You would ? Mr. Richards. Yes ; but I would still feel that it was a very small percentage of risk. You are under the same temptation exactly. You have a reward for your efforts. You work hard ; so do I ; but there is no obligation on us to work ourselves to death so that it will put us back. Mr. Keating. Is there not a little difference in our case? Your salary for to-day, for instance, does not depend upon the exact amount of work which you perform to-day; neither does mine; neither does Gen. Crozier's. Gen. Crozier's eventual promotion may depend upon the work done by him to-day, to-morrow, and next year, but, Mr. Richards, is not that a little different from the man who worked yesterday for $1.50, but who to-day finds that if he works at top speed for eight hours, he may earn $3 ? Mr. Richards. You are illustrating the bonus plan there, and I have been thiifking along the line of the premium plan. There is a little difference there. The bonus is established upon the plan that a man must reach a certain standard ; if he does more, he gets more compensation. But in the premium plan there is not that inequality. Mr. Keating. Most of the witnesses who have appeared here favor the bonus plan as against the premium plan. Mr. Richards. Whether they do or whether they were trying to answer with the bonus plan in mind, I do not know; but I would not advocate it unless the situation was peculiar, in preference to the premium plan. It gives you a little better control of your labor, but it is not essential in getting results. Mr. KJEATiNG. You said a certain figure represents a day's pay in the bonus system-^say $1.50 a day, for illustration. Then you set another standard, which we will say is $3 a day. If the employee can reach that other standard he gets the $3, but if he falls under it the hundredth part of an inch, all his work has been for naught, and 292 METHOD OF DIEECTING WOEK OF GOVEENMENT EMPLOYEES. . he falls back to $1.50. The object of that system is to keep him con- stantly struggling to reach that high point, is it not ? Mr. Eici-iAKDs. Yes, sir. Mr. Keating. Under the premium system he is paid $1.50 for turning out eight pairs of shoes and a certain fixed sum for turning out each additional pair ? Mr. EiCHARDs. Yes, sir. Mr. Keating. That is the difference between the two? Mr. EiCHAEDS. Yes. sir. Mr. Smith. The purposes of the bonus system and of the premium system are to increase the output of the workman, are they not? Mr. Richards. To stimulate the man to do his best. Mr. Smith. To increase the output of the workman ? Mr. EiCHAEDS. Yes. Mr. Smith. If it did not do that, the manufacturer would have no interest in it, would he? Mr. EiCHAEDS. I think that is true. Mr. Smith. I want to ask if a premium or a bonus is paid to the men for the purpose of requiring them to perform, or inducing them to perform, more than the ordinary day's work, an ordinary and reasonable day's work? Mr. Eichards. No. If it was based on an unfair or abnormal day's work, the system would fall; the employees would lose confi- dence in it, and the manufacturers would be worse off than before. Mr. Smith. In establishing an efficiency s;^stem, is it not true that they take their best workmen and try to fix him as a standard for the day's work? Mr. EiCHAEDS. Not always; not often, no. Mr. Smith. You said something about Mr. Feiss's establishment. Mr. EiCHAEDS. Because he testified here the other day. Mr. Smith. You heard him state he was in favor of seven hours a day, of labor? Mr. EiCHAEDS. I should not be surprised. Mr. Smith. Do you recommend that in your system — seven hours for the day's standard? Mr. Eichards. I do not think that a man overworks himself work- ing eight hours. I would rather see it seven than nine. Mr. Smith. You are in favor of eight, rather than seven? Mr. Eichards. I would get better results on the eight-hour day. Mr. Smith. Your idea is that the worlanan should have two- thirds of the increase where he performs more than the ordinary day's labor? Mr. Eichards. Left to ourselves, we would divide it, half and half. Mr. Smith. Half and half looks very reasonable, I will say that. But if it were true that even at a half-and-half rate, there is no inducement to the manufacturer to extend the employment of his workmen. He comes out just the same in the end as if he paid the ordinary wages. Mr. Eichards. No. I will give you an illustration. Take the 8 |)airs of shoes. The factory has overhead for the entire 8 pairs. We will say it runs up to $8 ; sometimes it runs up over that. If a man is getting $8 and thfe manufacturer is also paying out $8 more for overhead, and the workman can be stimulated to produce 9 pairs METHOD OF DIBECTING WORK OF GOVERNMENT EMPLOYEES. 293 of shoes, for which the manufacturer pays him $9.50 for the 9 pairs of shoes, the cost of the 9 pairs of shoes is $17.50 — the compensation of the workman $9.50 and overhead $8. These 9 pairs of shoes at the old rate would have cost $2 apiece; so he has saved 50 cents a day. He has paid $8 for overhead and $9.50 to the workman, and he has produced $17.50 of products. He is 50 cents in pocket. He has that gain, because he has spread that overhead over 9 pairs of shoes instead of over 8. Mr. Smith. What do you mean by "overhead?" Mr. EiCHARDS. Why, the cost of cleaning the factory, the cost of the engineers, the cost of fuel burned, the power consumed. . The actual overhead is 100 per cent of the money paid for direct labor. That is a very moderate estimate. Of course, the material cuts no figure. It costs the same in each case. Mr. Smith. Overhead charges are more when you are worldng under a premium or bonus system than under the ordinary day's labor, are they? Mr. Richards. You have an overhead charge either way. In the case I cited there is a saving of a dollar a day in the overhead charge^ and the manufacturer gets a part of it, and a part of the benefit goes to the workman. In this case he has divided up with his workman the difference between $18 and $17, which would be the cost if he had paid the workman just exactly $9 for the 9 pairs, because he has spread his overhead over 9 pairs of shoes instead of 8. It is a dollar saved, and he gives the workman the benefit of half of it and takes half for himself. Mr. Smith. It looks pretty complicated to me, but I would not dispute it, inasmuch as you have given it great study and so on. But it is true that the manufacturer paid $1.50 for the ninth pair of shoes, taking that same illustration. If he got them made for a dollar, he would be losing, or if he paid two-thirds of the cost of the shoes to the workman and kept one-third for himself it would be to his loss to offer a bonus or premium to have more shoes made for an ordinary day's work. Mr. Richards. Oh, no; it would not. Mr. Smith. I understood you to say that you thought the workman should have two-thirds of the profit. Mr. Richards. I do not think so. If I said that I did not mean it; It may be necessary, frequently, to stimulate the workmen. Our thought would be half and half. Mr. Smith. I quite agree with you on that, Mr. Richards. Mr. London. You are too frank and candid a witness to let go so soon. In competitive industries, the basic wage is determined by competition, is it not? Mr. Richards. Yes, sir. Mr. London. Am I right in assuming that? Mr. Richards. Surely. Mr. London. It will be competition which will determine what a fair wage shall be? Mr. Richards. Yes. Mr. London. If there is a large supply of men and the supply of men is larger than the demand, then the basic wage will necessarily be small? : 294 METHOD OF DIEECTING WORK OF GOVEKNMENT EMPLOYEES. Mr. Richards. Yes. Mr. London. Yes. Mr. Nolan. You have attended practically all the hearings of the committee in the last several days ? Mr. EiCHARDS. Yes, sir. Mr. Nolan. You have heard the testimony of all the men who have appeared here opposing this measure, have you not ? Mr. Richards. I think so. Mr. Nolan. Some employers who have installed an efficiency sys- tem and their efficiency engineers ? Mr. Richards. Yes. Mr. Nolan. There has been a great conflict of testimony on the part of witnesses who have appeared here opposing this measure, regarding scientific management, as it is applied. Mr. Richards. I think the conflict has been more seeming than real. It is rather an intricate subject. It is pretty hard to make it absolutely clear. Mr. Dunlap who appeared here — ^the editor of the Engineering Magazine — would have no reason for knowing the oper- ation of these principles. He has not been a student, as we have who have had to face the workmen and meet the difficulties. Mr. Nolan. Still he is considered an authoritj^ sufficient to Mr. Richards (interposing). To edit a magazine. Mr. Nolan. To have a large circulation of his magazine, a great portion of which is devoted to efficiency. Mr. Richards. ,Surely. Mr. Nolan. And would naturally be somewhat familiar with the various systems, after editing a magazine which took such a keen interest in this movement. Mr. Richards. Yes. Mr. Nolan. In writing he must be somewhat familiar with effi- ciency, from the statements he makes before this committee; isn't that a fact? Mr. Richards. Yes ; I think he thinks he knows it. Mr. Nolan. We will take the other gentlemen who have appeared here. Has there not been a diflFerence of opinion among them ? Mr. Richards. I think that Mr. Thom made a very clear and very lucid explanation of his views, and I think Mr. Feiss was very clear, and I did not hear anything that Dr. Kent said that did not sound reasonable. Mr. Thompson had some difficulty in communicating his views of the bonus plan. I know what he had in mind, and it was not so much in conflict with what I have said ; but he did have a great difficulty in answering what the ninth pair of shoes would cost. Mr. Nolan. If you were sitting on this committee and listening to the testimony of efficiency experts who stated their reasons for oppos- ing this bill, what would you think of the conflict of opinion on the part of efficiency engineers and efficiency experts? Mr. Richards. I do not want to subscribe to the statement that there has been a conflict of opinion, because I think their opinion, as far as that goes, was stated, to the effect that you could not afford to advocate this legislation; but their illustrations in answering your questions at one time and another show the great difficulty that is ex- perienced everywhere in this world in making the language convey the thought. METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. 295 Mr. Nolan. You will agree with the proposition that the eight pairs of shoes was a simple proposition, will you not? Mr. Richards. Mr. Thompson attempted to handle it from the standpoint of the bonus plan. I have attempted to handle it from the standpoint of the premium plan; and really and truly Mr. Dunlap did not know anything about it. Mr. Nolan. Would you lilten the position of the ordinary man under the bonus or premium system to the farmer and the mule? A farmer put some carrots on a stick in front of his mule and the faster the carrots went the faster the mule went, and the mule kept on until he died. Would you liken the average man to the mule? Mr. Richards. If I did, it would fall of its own weight. You know that can not be true. Mr._ Nolan. Well, we have the testimony of experts who are applying this system and who did not agree at all and who could not answer simple questions. Mr. Richards. I have answered every question propounded to me by the committee. Mr. Nolan. You have had the experience of listening to the others. Mr. Richards. That is a disadvantage, because it was not leaving me anything to say. Mr. Nolan. I think your explanation of the shoe proposition is the clearest we have had and the fairest we have had. Mr. Richards. Thank you. Mr. Nolan. It is the clearest and fairest. It shows a wide differ- ence of opinion. You would pay the man 150 per cent for the iiinth pair of shoes, whereas other men testified here, who are here as efficiency experts, that man would be only entitled to from 33^ to 50 per cent. How can a system of that kind be satisfactory to the workmen of this coimtry ? Mr. Richards. I gather that I will have you for a client. You will hire me instead of the other fellow. That difference of opinion exists all through the profession. Mr. Nolan. All right. Suppose we take Thompson, and he gets as a client a large shoe manufacturing company, and you get another large shoe manufacturing company for a client, and that competi- tion exists between them. , Mr. Richards. Yes. Mr. Nolan. Suppose you apply your system of compensation, bonus or premium, whatever you wish to term it. Mr. Richards. Yes. Mr. Nolan. And Mr. Thompson applies his. Mr. Richards. Yes. Mr. Nolan. The difference in compensation to the operator for the ninth pair of shoes is a difference of from 50 to 150 per cent. How long is the man who happens to be your client going to permit that compensation to go to his employees? Mr. Richards. You understand that Mr. Thompson, if he could have made himself clear, would pay the same compensation to that employee provided he reached the standard ; but he could not get the language to convey that. We were not so far at variance as it sounded. Mr. Nolan. Take Dr. Kent, who is clearer, and an acknowledged authority and who has applied n system in his own establishment and, 296 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. I presume, in other establishments also. Suppose you and Mr. Kent had clients in the shoe business and he applied his system and you applied yours, how long would your client stand up under that com- petition ? Mr. Richards. What was his testimony? Mr. Nolan. His contention was 50 per cent. Mr. Richards. For the ninth pair of shoes? Mr. Nolan. Yes. Mr. Richards. My workmen would be more contented than his, I think. Mr. Nolan. The workman undoubtedly would be more content. That is conceded. But how about the employer that must meet the competition — the employer that you had as a client — as against Mr. Kent's employer or client, if you had to go out on the market and compete in a given field? How long could he carrv on the system you installed and pay this additional compensation? In other words, wouldn't it result in that man's having to revise your work? Mr. Richards. I do not think so. Sir. Nolan. Of course, in any establishments, the premium plan or Dr. Kent's plan either would depend upon its fairness. It is easy enough to revise upward. It would be practically impossible to revise downward and keep the good will and confidence of your men. Mr. Nolan. I am glad you covered that point. That is just what I wanted to go to — that there would be dissatisfaction on one side or the other. If the one set of men did not get a revision upward there would be dissatisfaction there? Mr. Richards. Surely. Mr. Nolan. And if the gentlemen you had as clients undertook to revise downward Mr. Richards (interposing) . There would be a destruction of con- fidence. Mr. Van Dtke. Are you in favor, Mr. Richards, of the piece system ? Mr. Richards. In certain cases; surely. Mr. Van Dtke. Most of the experts who testified here have been very strongly against the piece system. Mr. Richards. There is nothing to be said against the piece system, if a problem lends itself to that solution. Mr. Van Dyke. In another question Mr. Nolan asked you the difference in this ninth pair of shoes in the factory where you gave the $1.50 premium. You would get more efficiency in that factory, would you not, and more men would be after that $1.50, would there not, than where they got only $1 or 75 cents? Mr. Richards. Surely. Mr. Van Dyke. And you would make more on the amount of extra efficiency than you would lose in paying that extra amount? Mr. Richards. Don't get the idea that I am paying any extra amount. I have made a direct gain of 50 cents there. The overhead is just as real as the wages. I have saved $1 and I have divided that into two parts, giving 50 cents to the employee and keeping 50 cents myself. I can keep that up at the same ratio until every man in the factory is working with every bit of efficiency there is in him, thus giving the factory an increased production ; and I can do it with a METHOD OF DIEECTING WOEK OF GOVEENMENT EMPLOYEES. 297 continued saving and with continued benefit to the employee. And that is what I contend is placing the employee in partnership with his job, in partnership with his employer. And, gentlemen, that is not a trifling question ; it is a very serious question, and you can not afford to attempt to deprive him of that opportunity, even indirectly. You can not put that in the Government workshops and say that it does riot affect commercial business. Mr. Van Dyke. You can not figure overhead charges in determin- ing just how much that should be, whether it should be $1 or $1.25 or $1.50. Mr. Richards. Yes. This is subject to all kinds of modification. If the employee had to be given one or more assistants in order to get this efficiency, that should be taken into consideration in estab- lishing the rate. If the facilities are given the man in the beginning and he increases the output, he should be given recognition for that ; and as a bald illustration that is perfectly good. Mr. Nolan. But the fact still remains that Mr. Kent's client would receive the ninth pair of shoes at a cost of 50 cents, while your client would have to pay $1.50. Mr. EiCHAEDS. Mr. Kent could not get our rate. The only thing he could do would be to say, " If you will make 11 pairs of shoes, I will give you $12.50," but he could not do it. I stand baldly upon that statement. Mr. Nolan. He would still have a great many years of study and application to this subject, as he has told the committee. Mr. Richards. I do not want to reflect upon his testimony. I have listened to Harrington Emerson at a merchants association luncheon, when he would give an illustration of a planer. His illus- tration was that the tool was cutting one-sixteenth of an inch, taking off one-sixteenth of an inch with each direction of that plane, and that 24 inches of that tool is cutting in air for the 4 inches that he was actually cutting in the metal, whereas the tool was capable of making a three-sixteenth of an inch cut, and that the machine would be the same. You could easily work out from that the position of making him contend that there was seven or eight times the efficiency to be procured. He did not make that statement. That is just an illustration of how a man's mind will work. I am not talking about Mr. Kent ; I am talking about Mr. Harrington Emerson. Mr. Nolan. That is all. STATEMENT OF HON. CLYDE H. TAVENNER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS Mr. Nolan. Congressman Tavenner desires to make a statement. Mr. Tavenner. I just want to make this statement because I want to be fair to Mr. Richards. I am satisfied that in raising this money neither he nor the committee of ten did anything objectionable. In the last Congress there was an investigation into the business methods of the National Association of Manufacturers, and Mr. Emery of that association seemed to be in charge of the opposition to the bill, and I thought that the revelaflons coming before that committee justi- fied me in keeping, track of what that same association was doing in connection with this bill; and when I read a letter stating that 298 METHOD OP DIEECTING WORK OF GOVERNMENT EMPLOYEFS. money was being raised to defeat this bill, I though I was justified in giving the facts to the committee. I want to say, in fairness to Mr. Eichards, that I do not think that he has done anything in the least objectionable, and I thought it right that the hearings should con- tain a statement to this effect. STATEMENT OF MR. CHARLES A. HOWARD, 23 EXCHANGE PLACE, NEW YORK. Mr. Howard. It seems to me the purpose of this bill to protect the workman against expending himself unduly, etc. The premium and bonus systems offer opportunities perhaps for the unscrupulous manufacturer to commit abuses, but the same results could be ob- tained on plain day work. I have been in a great many factories, and the factory which is driven the hardest of any factory I have ever been in employs no piecework, no bonus system, and no pre- mium plan. It is straight day work. That means a proposition the same as you would have with a bonus proposition without the mini- mum. They pay a sufficiently high rate of wages, day work, so that everybody in the vicinity wants to work in that plant. They get thg pick of the men, naturally. They lay out what they want them to do and it is very excessive. They require them to do that and the man that puts up an argument against it gets paid off. The bonus system, carried out to its extreme limits, could not drive a man any more than by plain ordinary day work. The stop watch is used principally as a laboratory , instrument. It is seldom used in the plant, standing over the worlonan, timing him. Its method is more particularly — and its greatest use is — in taking the operation that is to be performed and making a laboratory study of it before setting the time, or determining what will be a rea- sonable time, in which to do or perform that operation. It is also extremely necessary in deciding upon the method to be used. Take, for instance, the case of planing a plane surface, of iron or steel. There are four ways by which this may be done. It can be done on a planer ; it can be done on the milling machine ; or it can be done on a surface grinder, or on a shaper. How is the manufacturer go- ing to know which one is the best method to employ without experi- menting on it in the laboratory ? The method to be used varies with every kind of material and every different shape of article. Unless you can take some time-measuring device and find out the time re- quired, you can not determine the best method. Mr. Smith. Could it not be done by seeing how many pieces he had done in a day ? Mr. Howard. You are measuring the time, then. Instead of meas- uring it by whole day's work, you can start a man on a job at, say, 11 o'clock, and determine it from that. Besides, a man in the shop does not always work on the same kind of work a whole day or day after day. He may start in at 11 o'clock on one job; at 11.30, he will have to be transferred to another job, and so on. Mr. Smith. The stop watch is eliminated in that case. Mr. Howard. Or other measuring devKe, if you take it through- out the whole day. But why continue an operation throughout the whole day to determine what may be determined in a comparatively METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 299 short time ? We go into the laboratory and determine in the way I have indicated the method to be used, for instance, on work that will suffice to keep the factory going for six months. The stop watch itself we do not use a great deal. Time-measuring devices are used in the cost of manufacturing a product. A manufacturer who makes a great many products will frequently have an employee who will start in at 9 o'clock in the morning on one job and at 10.30 will be transferred to another job, which he will complete by 11 o'clock and then be transferred to another. In that case, one of the most important time-measuring devices is the time clock, where a man puts a card in and operates the clock and makes a record of the time he starts on a job and the time he finishes it. That is the basis of finding the cost of a particular job of work. If you prohibit the use of that, as this- bill does, it will keep the Ordnance Department from finding out what a rifle barrel costs. There may be several different kinds, and one may cost a little more than another ; and there ought to be some method for determin- ing that point. All those things require the use of it. That is an instrument of precision. If we can not use such an instrument of precision, factories must be run on guesswork instead of on knowl- edge. Every factory is successful pretty well in proportion to what the management know about the business and not to what they guess about it in general. "that is all I have to say, gentlemen. (Whereupon, at 1 o'clock p. m., a recess was taken until 2 o'clock p. m. of the same day.) AFTER RECESS. At the expiration of the recess the hearing was resumed. STATEMENT OF ME. JOHN P. FREY, EDITOR OF THE INTERNA- TIONAL MOLDERS JOURNAL, CINCINNATI, OHIO. The Chairman. Mr. Frey, will you please give your name, occu- pation, and residence? Mr. Fret. John P. Frey, editor of the International Holders Journal, Cincinnati, Ohio. The Chairman. I will state that the system adopted by the com- mittee is this: The witness is permitted to make such a statement as he sees fit, and then the members of the committee ask such ques- tions as may occur to them. Will you proceed, Mr. Frey ? Mr. Fret. Mr. Chairman, it might be well that, in the beginning, I should give the committee an idea of how I came into the possession of the material which I desire to lay before you. Owing to the interest that was taken in scientific management, the Federal Commission on Industrial Kelations desired to have a special investigation made of the subject. They appointed Mr. E. F. Hoxie, Ph. D., of the University of Chicago, to make, the investiga- tion. He was to devote one year's time to the work. Part of this work he felt should be the investigation of establishments where sci- entific management, so-called, had been introduced. He was of the opinion that, as a university man, he would be un- able to get at the actual facts that he came into contact with ; that he 300 METHOD OF DIKEGTIN6 WOEK OP GOVEENMENT EMPLOYEES. would be unable to give proper weight to the statements that the employees might make to him, efficiency engineers, or the workmen, and, as he desired his report to be one that would stand unchal- lenged, he persuaded the Commission on Industrial Kelations to supply him with two experts. One to be an expert on management, not particularly scientific management, and the other to be a tradeg unionist, somewhat familiar with industrial conditions. He felt that these two men with him, one playing against the other, one preventing the other side from getting away with mitt- statements, that he would more readily arrive at the actual facts. Mr. Eobert G. Valentine, who was associated with Mr. Kichards, was finally selected as the management expert. Before he was se- lected his name was submitted to Mr. Taylor, Mr. Harrington Emer- son, Mr. Gantt, and a number of others, with the object of discover- ing whether he would be satisfactory to them as a representative of management, or whether there were any reasons why he would not be competent to serve in the capacity in which he was wanted. The Chairman. Are the gentlemen you have named the leading efficiency engineers? . Mr. Feet. They are leading efficiency engineers, and while I would not want to say that they unanimously indorsed Mr. Valen- tine, I was given to understand that in no instance had any of the leading efficiency engineers raised any objection to Mr. Valentine's appointment. Under those conditions Mr. Valentine was appointed as management expert. Similar methods used in the selection of Mr. Valentine, who rep- resented employing management, eventually led to my selection, so that the three of vis spent some time in investigating some 35 indus- trial establishment, in which some feature of scientific management had been introduced and was then in operation. In the investiga- tions that we made of some of those plants it was impossible for the three of us to be there. On several occasions Mr. Valentine was absent ; but we kept in continual touch with each other. I think it might also be well, in regard to giving credence to the proper weight of the facts that I shall lay before you, to state that before Mr. Hoxie made the investigation of these plants, he desired to discover accurately what were the claims of the various efficiency engineers of the scientific management group as to the effect of scientific management upon labor. He also desired to secure an ac- curate, authoritative statement as to what labor's objections were, and, to this end, read the hearings that were held here in the Capitol, upon scientific management. He read the hearings of the special commissions that were appointed to investigate, such as the one that sat in connection with the Watertown Arsenal. He read the stand- a,Td books, such' as Mr. Taylor's Shop Management, the works of Mr. Gantt, articles by Mr. Cook, Mr. Hathaway, Mr. Kendall, and a number of others. From the hearings and from these books he drew up, approximately, 115 separate and distinct claims made by the scientific management group, as to the benefit of the system to labor. He then drew up a list of the charges which the trades unionists have brought against scientific management, and divided those into about an equal number of separate and distinct charges. I do not mean by that three or four charges upon one subject, but upon different point. ■ METHOD OF DIBECTIK6 WORK OF GOVERNMENT EMPLOYEES. 301 _ Wanting to be sure that his own lists were accurate he took the lists of the labor claims and of scientific management, and consulted with Mr. Taylor, with Mr. Gantt, and with Mr. Harrington Emer- son. There are two Emersons in the firm, and that is why I desig- nate Mr. Harrington. The lists were also taken and shown to a num- ber of others. He had them modify and add to the labor claims of scientific management so that, eventually, he had an authoritative statement from the highest authority in the scientific management group, as to what were the exact claims which scientific management made as to the benefits to labor under scientific management. He took the charges of labor against scientific management to the Philadelphia convention of the American Federation of Labor, in 1913. He appeared before the executive council of the American Federation, and Mr. Gompers, acting under the authority of the council appointed a committee, at that convention, to go oyer these labor charges and see whether they were accurate or not. It so hap- pened that I was selected as one of the committee, and was called upon to do much of the work. I examined the labor charges against scientific management, and when I had done that I insisted that the modified charges should be presented to the oflScials of the American Federation of Labor. They were first gone over by Mr. Frank Morrison, the secretary of the Federation, and then they were submitted to Mr. Duncan, the first vice president of the Federation, and some changes were made. Finally, they were submitted to Mr. Gompers, for his revision. So that before the field work was undertaken, Mr. Hoxie had in his pos- session the authoritative statement of labor's charges against scien- tific management, and the labor claims of scientific management. The charges against scientific management, on labor's part, formed on list, and I have a copy with me which the committee may keep, if they desire. The Chairman. Without objection it will be inserted in the record, with the testimony of the witness. Tkade Union Objections to Scientific Management. teade union objections directed against the alleged oeneeal chabactee and spieit of " scientific management." Organized labor understands by the term " scientific management " certain well-defined "efficiency systems " which have been recently devised by individ- uals and small groups under the leadership or in imitation of men like Fred W. Taylor, H. L. Gantt, and Harrington Kmerson, by whom this term has been pre- empted. Organized labor makes a clear distinction between " scientific manage- ment " thus defined and science in management. It does not oppose savings of waste and increase of output resulting from Improved machinery and truly efficient management. It stands, therefore, definitely committed to science in management, and its objections are directed solely against systems devised by the so-called " scientific management " cult. Against " scientific management " thus defined, the trade unions charge that : 1. " Scientific management " is a device employed for the purpose of increas- ing production and profits, and tends to eliminate consideration for the charac- ter, rights, and welfare of the employees. (a) It libels the character of the workmen. ( 6 ) It looks upon the worker as a mere instrument of production. (c) It ordinarily allows the workmen no voice In hiring or discharge, the setting of the task, the determination of the wage rate, or of the general con- ditions of employment. 302 METHOD OP DIRECTING WORK OF GOVEBNMENT EMPLOYEES. (d) In spirit and essence so far as labor is concerned it is a cunningly de- vised speeding-up and sweating system. (e) It is based on the principle of the survival of the fittest. 2. " Scientific management " is opposed to industrial democracy ; it is a reversion to industrial autocracy. It forces the workmen to depend upon the employers' conception of fairness and limits the democratic safeguards of the worker. 3. " Scientific management " in its relations to labor is unscientific. (o) It violates the fundamental principles of human nature by ignoring tem- perament and habits. (6) It concerns itself almost wholly with the problem of production, disre- garding in general the vital problem of distribution. (c) It is unscientific in its determination of the task and the wage rate. (d) It does not talce all of the elements into consideration, but deals with human beings as it does with inanimate machines. 4. " Scientific management " could be scientific, and, at the same time, be Inimical to the welfare of the workers. 5. " Scientific management " does not tend to develop general and long-time economic- efficiency. 6. " Scientific management " tends to emphasize quantity of product at the expense of quality. 7. " Scientific management " Is incapable of extensive application. 8. " Scientific management " is a theoretical conception already proven a failure in practice. TEADE UNION OBJECTIONS DIRECTED AGAINST THE EFFECTS OF SCIENTIFIC MANAGE- MENT UPON THE CONDITIONS OF WOKK AND THE CHARACTER AND WELFARE OF THE WORKERS AND SOCIETY. The trade unions charge that: 1. " Scientific management " greatly Increases the number of " unproductive workers," that is, those engaged in clerical or supervisory work. 2. " Scientific management " tends to gather up and transfer to the manage- ment all the traditional knowledge, the judgment, and the skill, and monopolizes the initiative of the worker in connection with the work. 3. " Scientific management " intensifies the modern tendency toward extreme specialization of the work and the task. (a) It splits up the work into a series of minute tasks. (6) It tends to confine the worker to the continuous performance of one of these tasks. 4. " Scientific management " displaces day work and day wages by task work and the piece rate, premium and bonus systems of payment. 5. " Scientific management " is arbitrary in the setting of the task. (a) It tends to set the task on the basis of " stunt " records of tlie strongest and swiftest workmen without due allowance for the human element or un- avoidable delays. (6) It holds that if the task can be performed it is not too great. (c) It shows a constant tendency to increase the intensity and extent of the task. 6. " Scientific management " forces individuals to become " rushers " and " speeders." 7. " Scientific management " tends to displace all but the fastest workers. 8. " Scientific management " greatly intensifies unnecessary managerial dic- tation and discipline. 9. " Scientific management " has refused to deal with the workers except as individuals. 10. "Scientific management" tends to disregard the physical welfare of the workers. 11. " Scientific management " through these attributes and methods : (1) Tends to deprive the worker of thought, initiative, sense of achievement, and joy in his work. (2) Tends to eliminate skilled crafts. (3) Is destructive of mechanical education and skill. (4) Tends to deprive the worker of the possibility of learning a trade. (5) Puts a premium on muscle and speed rather than on brain. (6) Condemns the worker to a monotonous routine. (7) Dwarfs and represses the worker intellectually. METHOD OP DIEECTING WORK OP GOVEBNMENT EMPLOYEES. 303 (8) Tends to destroy the individuality and inventive genius of tlie workers. (9) Stimulates and drives the workers up to the limit of nervous and physical exhaustion, and overfatigues and overstrains them. (10) Tends to undermine the workers' health. (11) Shortens the workers' period of industrial activity and earning power. (12) Increases the danger of industrial accidents. (13) Tends to destroy the workers' self-respect and self-restraint and leads to habits of spending and intemperance. (14) Tends to increase the number of punishable shop offenses, and the amount of docking and fining. (15) Tends to prevent the presentation, and denies the consideration, of grievances. (16) Constitutes a species of industrial " third degree." (17) Creates the possibility of systematic blacklisting. (18) Destroys the independence and manhood of the workers. (19) Tends to reduce the workers to complete dependence upon the em- ployers, to the condition of industrial serfs. (20) Introduces the spirit of mutual suspicion and contest among the men, and thus destroys the solidarity and cooperative spirit of the group. (21) Strikes at the root of workshop ethics. (22) Is incompatible with and destructive of collective bargaining. (23) Destroys all the protective rules and standards established by unionism. (24) Discriminates against union men. (25) Is incompatible with and destructive of trade unionism. (26) Displaces the skilled workers and forces them into competition with the less skilled. (27) Narrows the competitive field and weakens the bargaining strength of the workers through specialization of the task and destruction of craft skill. (28) Establishes a rigid standard of wages regardless of the progressive Increase In the cost of living. (29) Puts a limit upon the amount of wages which any man can earn. (30) Often squeezes out of the workers vast overhead charges. (31) Offers no guaranty against rate cutting. (32) Is, itself, a systematic rate-cutting device. (33) Tends to lower the wages of many immediately and permanently. (34) Violates and indefinitely postpones the application of the fundamental principle of justice in distribution. (35) Means, in the long run, simply more work for the same or less pay. (36) Tends to lengthen the hours of labor. (37) Leads to overproduction and increase of unemployment, (a) In the particular group. (6) In general. (38) Shortens the tenure of service and lessens the certainty and continuity of employment. (39) Fails to satisfy the workers under It; but, on the contrary, is regarded by them with extreme distaste. (40) Increases the antagonism between the workers and their employers. (41) Intensifies the conditions of Industrial unrest. (42) Offers no guaranty against industrial warfare and is conducive to strikes. 12. Finally, " Scientific management " puts into the hands of employers at large an Immense mass of information and methods which may be used un- scrupulously to the detriment of the workers and offers no guaranty against the abuse of its professed principles and practices. TRADE UNION OBJECTIONS TO SPECIFIC FEATTJEBS OF " SCIENTIFIC MANAGEMENT " ABE LEVELED MAINLY AGAINST TIME STUDY AND MOTION STUDY, TASK WOEK AND THE PIECE BATE, PREMIUM AND BONUS SYSTEMS OF PAYMENT EMPLOYED BY THE EFFICIENCY EXPEBTS. In this connection, they charge that: 1. Time study and motion study are a direct attack upon the rights, dignity:, and welfare of the workers, are destructive of skill and true efficiency, and are a menace to Industrial peace. (a) They are unfair in method. (6) They are an evidence of suspicion and a direct question of the honesty and fairness of the workers. 304 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. (c) They indicate a purpose on the part of the scientific managers and em- ployers to extract the last ounce of energy out of the worlters. (d) They ignore habits and traditions of work and tend to minimize the ac- quired skill of the worker. (e) They split the work up into minute tasks, discover the utmost which the most efficient worker can do as a " stunt " record, and- enable the employer to substitute piecework where before day work prevailed, and to substitute various premium and bonus systems for the day wage, and thus : (1) Increase the modern tendency toward specialization. (2) Destroy the skilled crafts. (3) Deprive the worker of training. (4) Reduce his work to a monotonous routine. (5) Repress his thought and intelligence. (6) Reduce him to a semiautomatic attachment to the machine or tool. (7) Tend to destroy his initiative, ambition, and inventive genius. (8) Encourage the piecework system. (9) Encourage the use of various premium and bonus systems. (10) Enable the employer to deal with the workers as individuals, and thus to substitute individual for collective bargaining. (11) To pit workman against workman. (12) To introduce rushers and speeders. (13) To destroy the basis of workshop ethics. (14) To destroy unionism and its protective rules and standards. (15) To speed the worker up beyond the point of physiological and mechani- cal safety. (16) To displace the skilled workers and force them into competition with the less skilled. (17) They thus lower wages and increase unemployment. (18) They tend to reduce the quality of the work and the output. (19) They tend to destroy the health and lessen the length of the productive period of the workers. (20) They increase the drastic character of the discipline. (21) They increase the possibilities of blacklisting. (22) They furnish no just or scientific basis for calculating the wage rate. (23) They increase the points of friction and are thus productive of indus- trial warfare. Time and motion study are not necessary to secure true efficiency, as all tlie data necessary for planning, routing, cost accounting, task setting, and true efficiency in work can be secured without resort to elementary time study and motion analysis and the use of the stop watch. 2. The methods of work and remuneration employed by " Scientific manage- ment," its basic wage, its task work, piece rate, premium and bonus systems, are unscientific and unjust in principle, are, in practice, inimical to the wel- fare of the workers, and are productive of social unrest and industrial war- fare. (a) The basic wase of "Scientific management" is simply the customary wage of the region for the class of labor employed. It has absolutely no founda- tion in science or justice, but is the outcome of the relative competitive strength of workers and employers, and is often estimated at the bare subsistence level or even below. (6) In accepting this wage as the basis of its "scientific" and just methods of remuneration, " Scientific management " conveys the impression that it, the base wage, also is scientific and just, and tends thus to make it permanent at its present level — to fix general wages at the present rates. (c) Tlie premium and bonus rates which "Scientific management" imposes Upon this basic wage are both unscientific and unjust to the workers employed. (1) Tliey are detei-uiined, not upon what the worker actually produces, and an attempt to approximate this, but upon a study of how little the worker must be given to Insure his utmost effort, and upon how much the employer ^raust be given of the worker's extra product to buy him off from rate cutting. (2) They usually result in giving the worker less than the regular rata of pay for his extra exertion, and only a portion, and usually the smaller portion of the product which his extra exertion has created. They are usually less ad- vantageous to the worker than straight piecework. (3) The premium and bonuses are usually arranged so that it is greatly to the advantage of the employer to prevent the workers from equaling or' ex- ceeding the task, and securing extra payment therefor. METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. 305 (4) Therefore, the task Is usually set so high that only a few of the strong- est and most agile workers are capable of accomplishing it and securing any bonus or premium. (5) There is a constant tendency to raise the task. (6) In the most advanced systems, there is a punishment by means of the lowering of regular rates, and the consequent loss of wage for the workers who fail to make the task thus set, as in the case ©(.differential piece rates. (d) The methods of payment employed by "Scientific management" there- fore: (1) Offer no guarantee against rate cutting, but, on the contrary, induce to systematic cutting of the rates. (2) Result usually in no gain over the customary wage for the most of the workers in the " Scientific management " shops, and sometimes in an actual lowering of the wage below the customary rate. (3) Result in the degradation of skilled to the condition of less-skilled men. (e) The modes of payment employed by " Scientific management": (1) Open the way for the employment of rushers and speeders. (2) Introduce the contest principle among the workers. (3) Displace harmony and cooperation among the working group by mutual suspicion and controversy. (4) Make collective bargaining practically impossible. (5) Prevent the enforcement of the protective standards and rules of unionism. (6) Destroy the union spirit and organization. (7) Induce and compel overspeeding and overexertion. ^8) Tend to undermine the health of the workers and bring on premature old age. (9) Increase the dangers of industrial accidents. (10) Jeopardize the quality of the product. (11) Lead to overproduction and unemployment. (12) Lead to a general lowering of wages and the standard of living among the workers. The modes of payment employed by " Scientific management " are not neces- sary to true efficiency. Mr. Fret. In the labor claims of scientific management there were some differences of opinion because Mr. Taylor, Mr. Emerson, Mr. Gantt, Mr. Parkhurst, Mr. Stimson, and a number of the .other eflBlciency engineers differed on some of the things which they called "fundamentals." So that, in addition to the general labor claims of scientific management, there was one set that was known as the " F. W. Taylor labor claims," one known as the " Emerson labor claims," and one known as the " Gantt labor claims." The substance of the three is about the same. I only have a copy of the labor claims of scientific management, as authorized and O. K'd by Mr. F. W. Taylor, and I shall be glad to leave that with the committee. The Chairman. That is by the Mr. Taylor, the founder of the system of scientific management ? Mr. Fret. The same Mr. Taylor ; yes, sir. The Chairman. Without objection it will be received and inserted in the record. The Labor Claims of Scientific Managers. [As revised by F. W. Taj'lor Nov. 11, 1914.] A. LABOR CLAIMS OF SCIENTIFIC MANAGERS TOUCHING THE GENERAL CHARACTER AND SPIRIT OF SCIENTIFIC MANAGEMENT. The scientific managers claim that : 1. Scientific management is a system devised by industrial engineers for the purpose of subserving the common interests of employers, workmen, and society at large through the elimination of avoidable wastes, the general improvement of the processes and methods of production, and the just and scientific distribU' tion of the product. 86162—16 20 306 METHOD OF DIRECTING WOBK OF GOVEENMENT EMPLOYEES. 2. Scientific management is based upon tlie fundamental assumption of har- mony of interests between employers and workers, and seeks to establish com- plete and harmonious cooperation between them. 3. Scientific management attempts to substitute, in the relations between employers and workers, the government of fact and natural law for the rule of force and opinion. It substitutes exact knowledge for guesswork, and seeks to- establish a code of natural laws equally binding upon employers and workmen. 4. Scientific management thus seeks to substitute, In the shop discipline, natural law in place of a code of discipline based upon the caprice and arbitrary: power of men. No such democracy lias ever existed in industry before. Every protest of every workman must be handled Ijy those oji the management side, and the right or wrong of the complaint must be settled not by the opinion either of the management or the workmen, but by the great code of laws which has been developed and which must satisfy both sides. 5. Scientific management perforce accepts the modern tendency toward specialization caused by machine production, but seeks to mitigate Its possible evil effects upon the workers: (a) By gathering up, systematizing, and systematically transmitting to the workers all the traditional craft knowledge and skill which is being lost and destroyed under current industrial methods. (6) By employing in the shop a corps of competent specialists whose duty it is to instruct and train the workers, and to assist them whenever difficulties arise in connection with the work. (c) By analyzing the operations of industry into their natural parts and assigning to each worker a definte and, by him, accomplishable task. (d) By bringing the worlters thus constantly Into close, systematic, and helpful touch with the management. (e) By requiring the workers to learn and to perform not one merely but several operations or tasks. (/) By treating each worker as an independent personality. iff) By rewarding the men for helpful suggestions and improvements in the methods of work. (ft.) By opening up opportunities for the advancement and promotion of the workers. 6. Scientific management seeks to eliminate overstimulation, overspeeding, and nervous and physical exhaustion of the workers : (a) By substituting exact knowledge based upon a careful study of men and machines for guesswork in the setting of the task, and the determination of the hours and other conditions of work. (6) By eliminating thus the need for the employment of pace-makers. (c) By transferring from the workers to the management responsibility for contriving the best methods of work. (d) By removing from each worker responsibility for the work of others, and for the Instruction of beginners and helpers. (e) By maintaining the best conditions for performing the work through furnishing the best tools and materials at the proper time and place. (/) By training the workers in the most economical and the easiest methods of performing operations. (g) By standardizing equipment and performance. (ft) By instituting rational rest periods and modes of recreation during the working hours. (i) By surrounding the workers with the safest and most sanitary shop environment. 7. Scientific management makes possible the scientific selection of workers, i. e., the mutual adaptation of the task and the worker. 8. Scientific management is thus a practical system of vocational guidance and training, and opens the way for all workers to become " first-class men." 9. Scientific management pays workers rather than positions ; it remunerates each man according to his efficiency. 10. Scientific management eliminates systematic soldiering, and thus the hampering and discouraging of the strong and willing by the weak and un- willing. 11. Scientific management, by these methods, seeks to secure more efficiency ■with less efCort, to increase the product which may be shared by employers and laborers; to raise wages while lowering the labor cost, and to place both pro- duction and' distribution upon a scientific and just basis. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 307 B. LABOR CLAIMS OF SCIENTIFIC MANAGERS CONCERNING THE EFFECTS OF SCIENTITIO MANAGEMENT UPON THE CONDITIONS OF WORK AND THE CHARACTER AND WEL- FARE OF THE WORKERS, INDUSTRIALLY AND SOCIALLY. 1. Scientific management develops and promotes a friendly feeling and rela- tionship between the management and the men. (a) The men are not soured, as under the old form of management, by: (1) The arbitrary bullying of foremen. (2) The injustice in the method and amount of remuneration. (3) The lack of proper tools and materials at the proper time and place for doing the work, and other delays and breakdowns over which they have no control. (4) The absence of proper instructions and guidance. (5) The necessity of doing work and assuming responsibility properly belong- ing to the management. (6) They do not spend time criticizing the management. (c) They are satisfied with the conditions of work and pay. (d) They consequently look upon their employers as their best friends. 2. Scientific management promotes friendly feeling and action among the workers in the shop or group. (a) It eliminates the irritation caused by the soldiering and poor work of individuals in the group. (6) It eliminates the ill-feeling caused by parasitism and advancement and remuneration by favoritism. (c) It eliminates the irritation caused by rules which prevent the ambitious and efficient workers from doing their best and being paid accordingly. (d) It eliminates the suspicion and ill feeling caused by the employment of pacemakers. (e) The men, consequently, work more cheerfully and are more helpful than under the old form of management. 3. Scienfific management stimulates and energizes the workers intellectually : (a) By bringing the workers into constant, close, and helpful touch with the management ; by its systematic transmission to the workers of industrial knowl- edge ; by its definite instructions ; by assigning to each worker a definite and accomplishable task ; by requiring the workers to perform, not one but several operations wherever possible ; b.v rewarding the men for usable suggestions and improvements ; by opening up opportunities for advancement or promotion ; by instituting rational periods of rest and recreation ; by treating each worker as an, independent personality ; by paying each man according to his efficiency. (1) Stimulates the thought and ambition of the workers. (2) Mitigates the monotony incident to modern machine industry. (3) Develops the workers' sense of personal achievement. (4) Puts interest, joy, and zest Into the work. (5) Develops and broadens the mechanical skill of the workers. (6) Stimulates the workers' inventive genius. (7) Promotes the workers' self-reliance, self-respect, individuality, person- ality, and dignity. 4. Scientific management guards the workers against overspeeding and ex- haustion, nervously and physically. (a) By substituting exact knowledge for guesswork in the setting of the task. (6) By removing the suspicions of the employers that the workers are soldiering. (c) By tending to prevent Ignorant bidding and cut-throat competition. (d) By eliminating pacesetters and turning speeders Into Instructors. (e) By training the men In the easiest methods of work. (/) By careful studies of fatigue and the setting of the task on the basis of a large number of performances by men of different capacities and with due scientific allowance for the human factor and legitimate delays. 5. The so-called speeding up of scientific management Is, In the main, a speed- ing up of machinery, requiring no extra exertion on the part of the workers. The speed of the men is determined by psychological and physical tests and is always set with reference to long-time results. Scientific management chal- lenges anyone to show any overstrained or overworked man In the scientific management shops. 6. Scientifle management insures just treatment of individual workers, and lessens the rigors of shop discipline: 308 METHOD OP DIEECTING WOBK OF GOVERNMENT EMPLOYEES. (a) By keeping records of conduct and exact performance. (6) By substituting the rule of natural law for the arbitrary decisions of foremen, employers, and unions. (c) By giving to the worker in the end equal voice with the employer. Botn can only refer to the arbitrament of science and fact. 7. Scientific management increases the skill, efficiency, and productivity of the workers: (o) By the scientific selection of workers so that each worker is set to the highest task for which his physical and intellectual capacity fits him. (6) By providing each worker with the best means and methods of work. (c) By educating and training the workers mechanically as they were never trained before. (d) By training the workers in the easiest and best methods of work. (e) By providing immediate inspection and immediate rewards for Incresised or Improved output. (/) By energizing the workers Intellectually. (g) By preventing the more efficient from being held back and demoralized by the inefficient. (h) By raising thus the old-age limit. 8. Scientific management improves the quality of the product : (0) By improved methods of instruction and inspection. (6) By endeavoring to set a task that will show proper relation between quantity and quality. 9. Scientific management tends to shorten the hours of labor. 10. Scientific management improves the conditions of sanitation and safety In the shop. 11. Scientific management, by all these means and methods : (a) Improves the workers' health. (6) Lengthens the workers' lives and period of earning capacity. 12. Scientific management, through its general spirit and Its system of wage payment, prevents arbitrary rate cutting and the placing of any arbitrary limit upon the amount which any worker may earn. Under scientific management the rate is never cut without an absolute change in the directions' governing the work and the time demanded for doing it. 13. Scientific management raises wages : (a) It directly and immediately increases the wages of the workers In scientific management shops from 30 per cent to 100 per cent. ( 6 ) It raises the wages of the unskilled by enabling them to do work formerly done only by skilled men. (c) It raises the wages of skilled workers by opening up opportunities for advancement and promotion. id) It tends to raise wages generally: (1) By broadening the field of industrial activity and increasing the efficiency of the workers. (2) By increasing the total output and thus the general demand for labor. 14. Scientific management tends to prevent the displacement and degredation of skilled labor which is a natural concomitant of developing machine industry : (o) By broadening and improving the mechanical training and skill of the workers. (6) By giving time for adjustment to changed industrial conditions. (c) By opening up new fields of work and extensive opportunities for advancement and promotion. 15. Scientific management tends to Increase the employment of labor in the trades where It is installed by cheapening and thus increasing the demand for the product. 16. Scientific management tends to lessen the dangers of general unemploy- ment : (a) By the scientific selection and training of the workers so that each one may find the work for which he is best fitted and thus may become a first-class worker in It. (6) By making possible a more accurate adjustment of supply to demand and so tending to eliminate crises and -depression. (c) By Increasing production, and so the demand for labor. 17. Scientific management lessens the necessity for a shop reserve of workers and lessens the number of part-time men. 18. Scientific management Increases the security and continuity of emnlov ment. The term of employment is longer and there is less shifting of emDlovees in scientific management shops than in ordinary shops. METHOD OF DIBECTING WORK OF GOVERNMENT EMPLOYEES. 309 19. Scientific management thus betters the industrial condition of both skilled and unskilled labor. 20. Scientific management makes collective bargaining and trade-unionism unnecessary as a means of protection to the workers. 21. Scientific management, however, welcomes the cooperation of unionism. 22. Scientific management tends to prevent strikes and industrial warfare. 23. Scientific management elevates the workers morally and socially. The workers under scientific management live better and tend to become more tem- perate and saving. 24. Scientific management democratizes industry ; it gives a voice to both parties and substitutes the joint obedience of employers and workers to fact and law for obedience to personal authority. 25. Scientific management tends to remove the causes of social unrest. C. LABOK CLAIMS OF SCIENTIFIC MANAGERS TOUCHING CEKTAIN SPECIFIC FEATURES AND METHODS OF SCIENTIFIC MANAGEMENT. In this connection, the scientific managers claim that : 1. Time and motion study is the accurate scientific method by which the great mass of laws governing the best and easiest and most productive movements of men are investigated. These laws constitute a great code, which, for the first time in industry, completely controls the acts of the management as well as those of the workmen, and, therefore — (0) Are necessary to secure efficiency and, therefore, justice to the workers and improvements in the wages and conditions of employment — (1) They substitute eract knowledge for prejudiced opinion and force in determining all the conditions of work and pay. Thus they make possible and are necessary to — (a) The adaptation of the task to the intellectual and physical capacity of the worker. (6) The payment of the workers in exact proportion to their efficiency. (c) The most efficient methods of performing the task. (d) The best conditions of work through the proper routing of the jobs and materials. (e) The elimination of systematic soldiering. (/) The elimination of the suspicions of the employers that the workers are gaining an unfair advantage. (2) They substitute exact knowledge for ignorance in accounting and bidding. Thus they alone — (o) Make possible exact cost accounting. (&) Make possible the elimination of ignorant and cutthroat compe- tition. H. K. Hathaway: (a) Make possible accurate cost prediction. (6) The elimination, of ignorant competition. (3) Time and motion study thus — (a) Are essential to the maximum of industrial and commercial effi- ciency and, therefore, of wages. (b) Eliminate the chief causes of speeding up and the arbitrary alteration of the task. (c) Eliminate the chief causes of rate cutting. ■ (6) Time and motion study, with the use of the stop watch, are not objected to by the workers when their purposes are properly explained and understood by the workers, and when they are used openly and aboveboard by men whose knowledge and ability the workers respect. 2. Task setting and the methods of payment employed by scientific manage- ment stimulate and energize the workers intellectually and are essential to maximum efficiency, maximum wages, and justice and fair dealing between employers and workers. (a) Scientific task setting — (1) Makes possible the mutual adaptation of the man and the work. (2) Promotes the training of the workman and makes it possible for every man to become " first-class " in some employment. (3) Puts zest into the work and gives a sense of achievement. (4) Eliminates the use of pace setters. (5) Promotes the workers' self-reliance and individuality. 310 METHOD OF DIEECa?IlirG WORK OF GOVEBNMENT EMPLOYEfi.S. (b) The modes of payment employed by scientific management — (1) Insure pay according to efficiency. (a) Tend to eliminate soldiering. (6) Eliminate the need for pace setters, (c) Turn foremen into instructors. (d) Increase efficiency and output. (2) Increase wages. (3) Tend to guarantee against rate cutting. (4) Secure justice for each worker. (5) Promote friendly relations between the employers and workers; pre- vent suspicion and complaints. (6) Promote friendly relations among the workers. (7) Develop the Individuality of the workers. Mr. Fret. I would say that I have here, Mr. Chairman, the field notes which I Icept myself. I also have here some of the field notes which Mr. Hoxie kept. I have a report, which I prepared myself for the benefit of the trade-union movement. I have a report, or rather an analysis, that was prepared, relative to the conditions at Watertown Arsenal by Mr. Minor Chapman, an efficiency engineer, and the statements which I make this afternoon will be taken from these authorities. I will leave a copy of my report on Scientific Management and Labor with the committee, and in doing so, will state that Mi*. Hoxie has prepared a much more complete report. I would also say that his report has been revised sentence by sentence, and paragraph by paragraph, by Mr. Valentine and myself. When we had done our work we jointly signed our names to it, without reservation, so that the Hoxie report has the complete indorsement of the expert representing management, and the complete indorsement of the assistant, who represented labor. The Chairman. Is tha:t report available? Mr. Fret. It is published by the Appleton Co., but, owing to a lack of funds, the Industrial Commission were not able to publish it. In it you will find a very close and complete analysis of the facts of the bonus system, the premium system, the differential piecework system, and the 37 varieties that have been grafted on to these three fundamental systems. Mr. Buchanan. How long is it ? Mr. Fret. Oh, it is quite a volume. The report that I have just presented to the committee was prepared for the benefit of the trade- union movement as information, but before I submitted it Mr. Hoxie went over the report with me so as to be certain that I would not make any statements in conflict with the facts, or draw conclusions, or make, deductions that were different from his without having good grounds for so doing. And in submitting it I have the authority of Prof. Hoxie back of it; he has O. K'd what I have written. The material I have here is crowded with facts that have a bearing on different features of scientific management. It would be impos- sible for me this afternoon to bring all of these out. I shall, how- ever, endeavor to bring out some of the principles of what, to me, ajjpears to be the most important facts for the benefit of the com- mittee; and afterwards I shall be glad to answer such questions as it is possible for me to answer. One of the features that, in my opinion, ought to be brought before the committee is the experiences at the Watertown Arsenal. But I think it may be better for me to leave the record, which I hold on METHOD or DIRECTING WOBK OF GOVERNMENT EMPLOYEES. 311 that question until after I have covered the more general question of scientific management itself. I would like to say in the beginning that it is exceedingly difficult to discuss scientific management, so called, before any body of men who have not themselves made a study, of it, because of the terms which have been used in connection or with reference to it by the scientific management group, and a lack of knowledge of just what ■those terms mean. And I would like, therefore, to begin my talk with a few general statements. In the first place, there is no such thing as " scientific manage- ment" — a complete system in itself, which has proved through objective facts that it is scientific. The term " scientific manage- ment" is a misnomer. The leading representatives of scientific management have endeavored, since we began to investigate the system, to get away from the term itself, and desire to call it " sys- tem of management." For, after all, what really exists are a number of systems, each system containing certain methods, such as the use of the stop watch, the use of the timing system, the routing of work through the planning room, and the paying of some other form of wages than piecework or daywork. Every scientific management engineer has worked out a system of his own, and has modified the original Taylor system very largely. We found upon careful investigation, that, while it was stated that fatigue studies were made, there is not in existence any studies in fatigue that would enable anyone to discover where the danger point in fatigue began, or when the danger point of fatigue had been reached. No scientist, to say nothing of the scientists of the scien- tific management group, has yet worked out any tables on fatigue. No one has as yet worked out any data on long-time efficiency. And what I mean by that is, the maximiun amount which a man can produce in a lifetime. They have records of what a man can pro- duce in a day, a week, a month, or a year, but there is no such thing as long-time efficiency records, or records which would indicate how much the workman could do in a lifetime. It has been rather a record of what spurters could do in a dash, and not how much a man can do week after week, month after month and year aPter year, say, in delivering the mail' in a city. We also found that there is no standard of measurement to de- termine what normal speed should be. That rests entirely upon the judgment of each individual efficiency expert. There is no standard of measurement at all as to what the speed should be. We also discovered that there is no standard to determine what the hourly wage rates should be, except that they base that upon what they find wages to be locally. In other words, they have evolved no standard, no rule, no method of measurement which would enable them to determine scientifically what the hourly wage rate should be. We also discovered that they have never been able, apparently, to work out any standard, or any rule, of measurement which would enable them to determine what the comparative value of one class of labor would be, as compared with another class. To illustrate what I mean by this: to discover what comparison there should be between a switchman's wages and the wages of an 312 METHOD OP DIKECTING WORK OP GOVEENMENT EMPLOYEES, engineer shunting cars in a yard, or the engineer running a through express. They have no standard for this at all, and they admit they have none, when they are questioned. So that the only standard they have in these important matters^ the only basic standard they have, is the individual opinion of each separate individual installing these efficiency systems. I would like, at this time, to say that we found it extremely diffi- cult to place much confidence upon their records of efficiency. A number of efficiency engineers have made statements — perhaps before this committee — and they have in their books and magazine articles, as to the change in efficiency as indicated by an increased output per workman. We discovered that very many of these increases in output were to be traced more to improved management methods in the way of handling material in the plant, by the introduction of better appliances, as air hoists from floor to floor, traveling cranes, where men formerly lifted by hand; and to be traced not by what labor had done itself, but to better management in the plant. We also discovered that the records they had, and which they used in order to prove that their system does not necessarily push labor to the limit, were very unreliable. A number of them have very interesting records, which would indi- cate that high percentages of the employees — as high as 95 per cent in task and bonus shops — earned the bonus, or, in other words, com- pleted the task within the time set and got the bonus. That testimony would indicate, super^cially at least, that the tasks set were so easy of accomplishment that most of the workers were able to accomplish them. The facts are, that where the task and bonus systems have been introduced, and where foremen are paid a bonus based upon the percentage of the workmen under them, to make their bonuses they become what are termed "bonus stealers." In other words, so much time is allotted to a task. A worker may have from 2 to 3 or from 25 to 30 different jobs handed to him during the day. Before he can begin the new order he must go to the office (or else a boy does that for him, depending upon the system in use), and the order is there stamped by a time clock, showing the moment at which the man began work on that order. When this order is com- pleted that slip goes back to the planning room and is there time- clock stamped, showing the time at which the job was completed, and if the job has been completed within the time set for the job the workman earns his bonus and the foreman his share. Jobs are set so unevenly under the task and bonus system that a very large number of the workers are unable to earn their bonus on one-half of the jobs, so the workers and the foremen get their heads together — ^the slips are sent into the office before the ]ob is finished. On one job during the day the worker will fall down lamentably, you see, to balance up the thing, but he will earn bonus so far as the record shows on one-half or two-thirds of the jobs that he in reality had not earned a bonus upon, but the time-clock records that they depend upon so much would indicate that he had. Discovering that condition in more than one plant, we realized that their data as to the percentage of workers who earn bonus was so unreliable that we did not feel justified in using it. METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYEES. 313 We also discovered this : That in a number of cases, in fact a very large number of cases, scientific management had not been intro- duced in the plants until the plants had become industrially sick, where the conditions were such that dividends were no longer de- clared, and it seemed very likely that the sheriff would appear on the scene. So they really came into the plants as doctors; to cure defects ; to get rid of the poor management and put an effective management in its place. And the return of prosperity and dividends was not due to the system so much as it was to putting out- the incompetent men who occupied high places; changing them, and putting compe- tent men in their stead. I am calling attention to this because it may throw a side light on some of the records which have been sub- mitted. I might say, too, that we discovered this in a number of plants that are known as " show plants." They are plants that have been written about considerably. Through the system of employment which they have established, they have got picked crews. You had before your committeee a manufacturer, who told you about the accomplishments in his plant. I think I had better not use his name because we pledged ourselves in visiting these plants that we would not use names in our report; that we would not furnish the names to the Commission on Industrial Relations, because we desired to get as much information as we could in those plants, and a number of employers, and some of the efficiency experts, said that if we pub- lished the names of the firms and engineers it wo.uld probably lead to labor troubles in each plant. But the committee may have no difficulty in knowing the particular firm I am now referring to. This firm as a part of its system has an employment bureau. They employ a large number of women, the majority of them, in fact, are women. The applicants for work are first submitted to a medical examination. Their eyes are tested; their ears are tested; their heart is tested; their lungs are tested, and their kidneys are tested. As a result of this preliminary investigation the records of the firm show that over 75 per cent of all applicants for work were struck off from their list of possible employees. Of the remainder who went to work they were tested for a while, and if they then failed to come up to the standard they were let go. So that instead of representing a normal condition for employees, this shop represented a particular crew of picked workers. Looking over them, as I did, I saw that very few of the women were over 30 years of age, and I think the larger number would be around 21 or 22. This plant had some particularly aggravating methods of speeding up the workers. They had a system which they called a piecework system, but it might also be called a premium system. They paid the workers so much a day, but they must also produce so much an hour, and they must produce so many pieces in an hour. Each group of workers had two sets of wages, for illustration, 28 cents and 35 cents. If the girl failed to produce the task set for her she was reduced from her 35-cent rate to the 28-cent rate. The Chaieman. You mean 28 cents an hour? Mr. Feet. Twenty-eight cents an hour. So that if she failed to reach the task set she was penalized by being placed in the lower wage rate. 314 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. An additional stimulus also was the erection of iron posts through- out the rooms. These men and women were garment workers, and the shop was an exceedingly well-lighted and airy one. I think it was as fine a shop to work in, so far as air and light are concerned, as I have ever been in. The large floors were open. The workers' were divided into groups of three and four; very seldom were there six. For each group there was an iron standard, and on the top of that standard, about 8 feet high, was a metal card. On that metal card were the number of operations, the number of buttons or collars to sew, that that group must perform, in order to accomplish the task set for them. So that a worker looking around the floor could see what every other worker had to accomplish. From time to time the bosses went around from group to group and counted up the operations they had performed up to that time. The bosses hung up cards showing how much they had accomplished up to that hour, so that by this means each group knew whether they were behind or getting ahead. That not only kept each group up to the mark, so to speak, of accomplishing their task, but it also created racing between the dif- ferent groups. And, in my opinion, it was intended to accomplish that purpose, for each little group, trying to show that they were as smart as the other groups, watched what other groups were doing. And when that failed to push them along, the foreman, or gang bosses, or speed bosses, would go up to their group and say, "that group has got us-beat, and we can not afford to let them do it." So, as I say, this is used as a form of additional stimulus to keep the workers up to the highest standard. It is impossible to say what the effect of that kind of labor will have upon the women. The system has only been in operation for three or four years, and the overturn of labor is 25 per cent, so the company stated ; and it is therefore impossible for us to judge what the physical effect of that system is to be on those women, for there ' are no long-time records. We can all draw our own conclusions, however, from that. In this same plan we had our attention called to one of the ways that scientific management has adopted. The effort of scientific management is to subdivide the work into the smallest specialty possible, the theory being that as you reduce the different operations the worker is to perform upon a piece the more competent and effi- cient the workers become. In this plant we went by a little girl who was threading needles, and our attention was called to the fact that the threads which she was threading were all of a standard length. The efficiency engi- neer had studied the trade of sewing on buttons, and had timed the firls with split-second watches, and with different lengths of thread, or the purpose of discovering what length of thread enabled the girl to seAv on the largest number of buttons in a day, and having found out what in their opinion was the proper length, they theu had all of these threads cut that length. The girls who were sewing on the buttons (this was a hand operation I am referring to) were not allowed to thread their own needles, because if one girl was taught the trade of threading needles she would become more efficient in threading needles than the girl who was taught the trade of sew- ing on buttons; and so one girl devoted her time to threading needles METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 315 with standard lengths of thread, and then the girls sewed on the buttons with the standard lengths of thread. In another garment-working establishment we took up the matter, and we found a difference in the scientific idea. In this other plant they had carried the scientific study of labor much farther, and having become convinced that the standard length of thread had something to do with the number of buttons that could be sewed on in a day, they reached the conclusion that perhaps the length of the girl's arm had something to do with that, because the girl with short arms would take a quicker, shorter stitch than the girl with long arms; and so they made a study with the number of buttons that girls sewed on per day, according to the length of the arms, and they standardized the length of the girls' arms who were to sew on buttons ; and then they carried it one step farther, and they found that the length of the fingers had something to do with it, and they made studies of the length of the fingers of the girls who were to sew on buttons, and they standardized that. So that the employment department vf&s called upon to hire girls with arms of a certain length and with fingers of a certain length to sew on the buttons with threads of a certain length. They had, how- ever, to abandon that system, because they found after they had standardized the whole thing there were some other factors — nervous coordination, for one thing — that even when they had standardized the whole thing made it possible for some girls to sew on almost twice as many buttons as other girls. I am merely calling your attention to one of the methods which scientific management may adopt in regulating labor. We found very early in our investigations that not only were the leading exponents of scientific management at odds between them- selves as to how time studies should be made and what form of pay- ment should be used, but that they were unanimously of the opinion that there were more fakers installing scientific management than there were fakers in any other profession. One of the most prominent of the group told us that in- his opinion there were five fakers for every genuine eiBciency expert in the field, and that organized labor, having come in. contact with the fakers'^ work, were justifiably opposed to what the fakers were doing, but that if we knew what the real experts were doing then we would not have such objection. It has proved a very profitable field. The employer listens to the story told by the efficiency expert; he sees his labor costs reduced, his production increased, and he puts these men in, sometimes with extraordinary results. In one instance, in Iowa, a very well-known expert, who had been advertised extensively in some of our magazines as teaching anyone how to study character and determine what a worker is adapted for, was paid a salary of $15,000 approximately for one year to install this method of selecting employees. I do hot think that that was the sole cause of the firm's going into the hands of receivers, but it was one of the causes; and in discussing this one case with a number of efficiency engineers they pointed out that under this " scientific " method for the selection of employees that it had worked out the reverse of what had been promised, and that in many instances, and particularly in managerial positions, the wrong person had been put on the job. 316 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. I would like to quote to you from what one or two of these gentle- men said to us about these fakers. One of the best known efficiency engineers said to us [reading] : At the present time there is a great dearth of men who are qualified by experience, training, and temperament to establish in industry the principles of " scientific ma,nagement " and to develop a proper mechanism for the applica- tion of these principles. There are also some of these men who are perfectly sincere and honest in their efforts, and do not realize their shortcomings or lack of qualifications. Others have regarded so-called efficiency engineering as a means of earning an easier living and making more money than they would otherwise be able to do in other fields. This gentleman is very prominent as an efficiency engineer. Another one equally prominent said to us [reading] : One trouble is that there are a large number of fakers installing systems under the guide of " scientific management " and it is because of what they have done that workmen have just cause for complaint? These are verbatim statements; which I took down myself at the time and had them verified. Another prominent efficient engineer said [reading] : There were more fake engineers in " scientific management " than in any other line. While I am on that, I might as well quote from a statement made to me by a partner in one of these scientific management installing firms that advertises somewhat extensively. This man had become some- what confidential with me when he made this statement. This is his statement verbatim: All of this talk about scientific management benefiting labor is b. s., but we have to use it for policy's sake. What the employers are after is results, and what That is the head of the firm's name, and I do not care to use it — are after is the money, and the financial results are the first consideration. In addition he said that always made the first time studies in a plant, and gave the foreman the first instructions, and that this frequently made trouble, and then that he — the man who was talking to me — was brought in and used as a pacifier or soft-soaper to follow up— and to sling the salve, and then later on to follow up the work of rate-making and task-setting. All of these efficiency engineers complain about the number of fakers who are in the business. As illustrating capacity and fitness of some of the recognized leaders, one of the best-known efficiency engineers, who advertises his business — I mean by that in the maga- zines, and seeks clients through advertising — was employed by a very large concern in Pennsylvania. We were told by the management that his fee was $100 per day, and that he had 12 of his assistants with him in the plane, who were receiving $75 a week. After the group had been there for a month or so, the general manager wanted to see some results for this work, and the money he was paying out, and he called upon to show him some definite items that he had discovered. He was told that it took a long time to install these systems, as they had to systematize the entire plant, but he thought that he would be able in a day or two to give him evidence of the METHOD OF DIEECTING WORK OE GOVERNMENT EMPLOYI'ES. 317 inefficiency that his experts were uncovering ; and a day or two later he went in to the office of the general manager and said : We have just discovered one of those things we are continually encountering. Upon the third floor you have two machines side-by-side; they are both made by the same manufacturer, and one of them is only turning out one-half of the product of the other. The manager said, " I want to see those machines." He was taken up to the third floor and shown the two machines, and the shown record of production from those two machines which the experts had gathered, and it is true they did show that one was turning out about twice as much as the other. The manager told him that that machine on the left was known as a " single-eight," and the machine to the right was known as a " double-eight," and both machines were doing exactly what he had bought them to do ; and the result was that this efficiency engineer lost his contract on the spot, and the whole outfit were dropped from the pay roll. But, I am calling your attention to that as just a little incident to indicate some lack of scientific accuracy which we encountered. In one very large company having a plant in Pennsylvania and another in Illinois, the president, who was a personal friend of one of the most prominent, if not the most prominent, advocate of scien- tific management, had introduced a system, and this is what he told us : If I had introduced scientific management in the literal way in which interprets it, I would have had a revolution on my hands, and the workmen would have been no good if they had not revolted. He said that while he was introducing this system found fault with him — this is the verbatim statement— because he did not " God damn " his men enough, and he had told — that he would be " God damned " before he would " God damn " his men, and that had he introduced the system as desired to have him do it, the men would not have been any good if they had not revolted. So far as the scientific management group, and I include in that the names I have already given — Taylor, Emerson, Gantt, Barth, Hathaway, Parkhurst, Simpson, Babcock, and others — lay as much stress upon the necessity of time and motion study as upon anything else. The managers all told us in the plants where we investigated conditions, that the stop watch and the time studies made with the stop watch and the motion studies which resulted were absolutely essential to the labor side of the. problem, that time and motion study were one of the keystones of scientific management, so far as the output of labor were concerned. We were imder the impression, when we began the investigation, that we would find something of a scientific character about time studies; that is, something that at least seemed to give evidence of scientific accuracy, something that would give definite knowledge as to the time required to perform a task, but we discovered that there was no such thing; that after all the time that was set upon a task was a matter of judgment on the time-study man's part, plus the readings of the time studies, plus the policy of the firm. I might at this time — and I want to discuss time study for a moment — call attention to this condition, which we discovered, in a plant in Connecticut, not far from the New York line. One of the leading efficiency experts had introduced his system in one depart- ment. He informed the firm that it would be necessary for him to 318 METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. set the jobs so that the workers would not be too frightened and! so that the results they would secure would lead the workers in the 'Other departments to feel willing to work under scientific manage- ment. This gentleman made the usual time studies and set the tasks as a result, and he set them liberally, because under scientific nian- agement you can make a task as easy or as hard as you want it — and when you are arguing the matter with the time-study expert the matter is as strong one way as the other — he set the tasks so easy that the employees in that department made a great deal more money than they had ever made before. The management became alarmed at what the efficiency expert had done, and they eventually let the «xpert go. Then they were threatened with a strike on the part of the employees in this department to retain the system, with the tasks as set because they were making a great deal more money than ever before and working easier. Not many miles from here, and in the same State, we went to an- other plant where scientific methods had been installed. There the manager wanted to secure better results as to output and a very rapid reduction in the cost of production. The tasks were set so hard that none of the workers could reach them, or such a small percentage, that this firm was threatened with a strike on its hands, and had to throw out all of the tasks set by this time-study man, and revise the jobs and make them easier, In a very large plant in Pennsylvania that has been sometimes quoted as an example of the ease under which the workers are em- ployed, where scientific management has been introduced, and where there was a difference in the speed at which the pieceworkers work, and those under scientific management work, we found this to be the condition: That it was a fact that the workers in the department under scientific management, where the task and bonus system had 'been installed, were working easier than in the other departments where it was piecework. We also found that their earnings were Tiigher than in the other departments where they had piecework, so that in reality, on the surface, under scientific management the work- ers had less diflGicult tasks to perform and secured higher earnings. We wanted to discover what lay under this, and we found that in the beginning the efficiency engineer who installed the system had im- pressed upon the firm that if the system was installed in all of its parts at one fell-swoop that the workers throughout the plant would become alarmed and they would probably have a strike on their hands; that it would be necessary to start this system in easily so that the first group of workers who worked under it would feel satis- fied, and then they would be able to go from one department to another. Previous to this time the girls in all of the departments when first put to work were paid at the rate of 10 cents an hour. He immediately raised the rate to 12 cents an hour, and then he made the tasks so easy that 95 per cent of the girls could perform those tasks within the time set, but the firm has never gone any further with the in- stalling of scientific management, because they discovered it was cost- ing them a great deal more for production in this department under :scientific management than it was under the piecework department. The superintendent who had charge of this department had quite METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYF.liS. 319 a tale of woe to tell. He said that the same corporation had another plant situated a few miles away and that there the manager was in- stalling the system, but without any of the easing qualities that had surrounded the introduction of it in this one department, that he was not paying a higher hourly wage rate, and that he was setting the tasks so that they were more difficult to perform, and as a result he was showing him up because his cost of production was so much lower, and he said, " If he keeps on doing this, I am going to be run out of my job or I will have to increase the tasks." In other words, the tinsel had been removed and they were getting right down to securing all of the production they could out of the lowest labor cost. I made the statement that there is nothing scientific about the con- clusions reached by scientific management in the setting of tasks, and I would like to give you some reasons for that. In these time studies that are made every small motion is timed, or an effort is made to time it, and we discovered one firm where they had subdivided the motions to such an extent that they could no longer make time studies because there was no time-study man competent to snap the watch fast enough to catch the subdivisions; they were too brief periods of time. But I have here one of the instruction cards from one plant in which such small divisions of time were made as these, the time being allowed in a hundredth of a minute: Put piece on arbor, 0.15; pick up wrench, 0.03; tighten expansion arbor, 0.15; lay down wrench, 0.02; as you will see a difference of 0.01 of a minute between dropping the monkey wrench and picking it up. But carriage up and set pointer at O, 0.16; put tool in post and set in center of pulley, 0.79; put piece on stud and fasten, 0.24; start machine, 0.02; set tool for turning and throw in feed, 0.18; turn outside diameter, 2-inch run, 1.64; throw out feed, 0.01 ; face inside and outside diameter of flange, 0.82 ; stop machine, 0.14. Instead of making my statement on this subject I would prefer to read an excrept from the Hoxie report on time study and then I will pass to one of the other features. I will say that this is the statement by Mr. Hoxie, indorsed by Mr. Valentine and myself [reading] ; It is the work of the time-study men which chiefly determines whether efficiency shall be combined with just and humane treatment of the workers, regardful of their present and future welfare. This being true, says the Hoxie report, the time-study man is, from the standpoint of labor, the central figure in " scientific management " — its vital organ and force. To perform his function properly, to make " scientific management " tolerable to labor, he must be a man exceptional in technical and Industrial training, a man with a broad and sympathetic understanding of the workers as well as of the economic and social forces which condition their welfare, a man of unimpeachable judgment, governed by scientific rather than pecuniary considerations, and, withal, he must occupy a high and authoritative position in the management. For if he is to set tasks that will not cause nervous and physical exhaustion, he must not only have an intimate personal knowledge of the work to be done, the special difficulties it involves, the quali- ties required to do it well, the demand which it makes on strength, skill, in- genuity and nervous force, but he must also be able to recognize and measure nervous disturbance and fatigue and understand and deal wisely with tem- perament. If he is to set tasks that will always be fair and liberal, he must understand and kaow how to discount all the eff^cts of current variations in machinery, tools and materials, in human energy and attention. If h.e is to safeguard the lives and health of the workers and their general economic 320 METHOD OF DIEEOTING WORK OF GOVEENMENT EMPLOYliE^. and social welfare he must be an expert in matters of sanitation &.n(l safety, and have a broad and deep understanding of economic and social problems and forces, and, finally, if he is to malie all this knowledge count, he must be able to establish the standards warranted by his study and judicial weighing of men and facts, and to protect these standards against infringement and displace- ment. All this and more, if the claims of " scientific management " relative to labor are to be generally fulfilled. But as things actually are, this emphatically is not the type of man who is habitually engaged in time-study work, and who is being drawn into it, nor does the time-study man of the present occupy this exalted position in the hierlarohy of " scientific management." The best men in this work are per- haps technically qualified, but so far as the observation of your investigator has gone, the best of them are technicians with little knowledge of the subject of fatigue, little understanding of psychology and temperament, little under- standing of the viewpoint and problems of the workers, and almost altogether lacking in knowledge of and interest in the broader economic and social aspects of working-class welfare. The bulk of the time-study men encountered were immature men drawn from the shop or from college. They were expected to get their knowledge and training in all the matters enumerated above through the actual work of the time study and task setting. In the majority of cases encountered it was not considered essential that they should have had any special training in the particular industry. A man who had worked exclusively in the machine shop was considered competent, after a few weeks or months of contact and trial experience, to set tasks in a cotton mill. Sometimes previous industrial experience of any kind was not considered necessary. Analytic:'.! ability, good powers of observation, a sense of justice and tact were the chief qualities emphasized as essential for a good time-study man. We inquired at every plant we visited what were the essential qualities of a good time-study man, and we summed up the results given to us by the efficiency experts and the owners of the plants as follows : Rarely, If ever, was anything said of technical knowledge concerning fatigue, phychology, sanitation, safety, and in broader problems of industrial and social welfare. Indeed, tlmfe study and task setting were almost universally looked upon as primarily mechanical tasks in which the ability to analyze jobs and manipulate figures rather than broad knowledge and sound judgment were regarded as the essential factors. Naturally, therefore, the time-study men were found to be prevailingly of the narrow-minded mechanical type, poorly paid. We found that the wages paid the time-study men, as a rule, varied from $75 to $125 a month — I am speaking now of the men in the firm's employ, not the experts who installed the scientific manage- ment, but the time-study men who stayed on the jobs afterwards — And occupying the lowest positions in the managerial organization, if they could be said to belong at all to the managerial group. Nor does the situation seem to promise much improvement. For the position and pay accorded to time-study men generally, are such as to preclude the drawing into this work of really competent men in the broader sense. Mr. London. Mr. Frey, who are these time-study men? Are they former mechanics employed in the factory ? Mr. Feet. Some of them were taken from the shops' crew. Some firms, once the system is installed, are informed that they must use employees m order to get the best results; other firms claim that you must get men from the outside. Some time-study men~I am not speaking of those in the expert's employ, but those in the shops- after the system was installed were college boys. We inquired of one of them what basis he had for reaching the conclusion that cer- tain times from the time studies were the ones to be selected. I may say, for the benefit of the committee, that every time study varies- that is, the worker is rated a little slower this tinie and a little faster METHOD OF DIEECTING WOKK OF GOVERNMENT EMPLOYEES. 321 the next time on the same operation or manual movement, and they gather hundreds of thousands of figures and then from this mass of figures they must pick out what will be the times they will accept as the standard for determining the time to be set the job. Each time- study man or almost every time-study man has got a different sys- tem of his own. Some throw out all oi. the maximum times and then take the average times and the minimum times and divide that by two and say, " This shall be the time." Others throw out all of the maximum times and all of the minimum times and from the re- mainder strike a curve and take the straight line. Others seemingly have no system. This time setter in a large concern where the high- est paid girl, when she earned a premium, secured $8.24 a week — ^the highest paid girl in the plant— had a system for throwing out cer- tain maximum times and minimum times and then using others until from the curve he secured a straight line on the chart he platted out, and we asked why he did this, and he said, " Why, he was following So-and-So's method." " Well, why did So-and-So adopt this rule?" He said, " I don't know ; I suppose he knew what he wanted to get, and that is why he worked out that rule." That is the only knowl- edge this man had of why he had a certain rule for determining what was the time selected in determining how much was a task for some- body and on which they had to earn a living. We found the majority of others equally as ignorant. While on our inspections we had a time study or two made in every plant. In one plant where we were assured that the workers had no opposition to being stop-watched — that is, having the time-study man back of them with a stop watch keeping the records; we had time- study man make some time studies for us. We were not satisfied with the way he was doing the job, and we had him do it over again. We then called his attention to the fact that he had marked variations in his figures, and he said : " I could have got it closer than this, but it made me nervous to know that you were watching me." [Laughter.] Aside from a few notable exceptions in the shops and some men who make a general profession of time study in connection with the installation of " scientific management," this theoretically important functionary receives little more than good mechanic's wages and has little voice in determining shop policies. The start is often made at $15 per week. A good time-study man, according to cur- rent standards, can be had at from $75 to $100 a month, and $125 per month is rather high rating for experienced men if the statements of scientific managers are to be trusted. In fact, the time-study man, who, if " scientific management " is to make good the most important of its labor claims, should be among the most highly trained and influential officials in the shop, a scientist in viewpoint, a wiser arbiter between employer and workmen, is, in general, a petty function- ary, a specialist workman, a sort of clerk, who has d6 voice in the counsels of the higher officials. There are, of course, exceptions to this general rule, but taking the situation as a whole, the quality of the time-study men actually set- ting the tasks in " scientific-management " shops and the position which they occupy are such as to preclude any present possibility of the fulfillment of its labor claims. In addition to the setting of the task and then the stimulating of the worker by the payment of a bonus and the premium systems, they have other methods. I have already called your attention to those standards with the figures on in the garment factory. One of the gentlemen who came before this committee recently, and who spoke about the interest which he had in the welfare of his employees, has evolved an additional stimulus which at least is unique. 36162—16 21 322 METHOD OF DIRECTING WORK OP GOVERNMENT EMPLOYl ES. Do you know what the metronome is? It is a little box-like clock arrangement with an arm in front that the piano pupil sets in motion to count time. This gentleman has some operations in his plant where objects are laid on the bench, where they are covered with a spray, and the operator stands up this way [illustrating] and moves an air needle or brush up and down from one row to the other. _ They have the efficiency method of payment there. That was found insuffi- cient, and so after timing these operators with the time watch until they had the time set, then in front of each one they placed a metro- nome like this [illustrating], and then as this arm beats backward and forward the worker goes up and down with the tool. I want to call your attention to a condition that we found, in addi- tion, where scientific management endeavored to stimulate labor. I am quite sure the committee has heard so much about task and bonus that they know just about what it is. The foremen are paid a bonus. They are paid a bonus based upon the percentage of the workers under them who reach their bonus. In another firm that did not have a metronome, but something else which they thought would be as efficient in getting the last possible ounce from the workers, they paid a bonus to all the foremen, based upon the per- centage of workers under their charge who earned their bonuses. Then they paid a bonus to the time-study man and task setter, based upon the number of workers who failed to make their bonus. In other words, the time-study man was paid a bonus, based upon the number of workers who failed to make task and earn the bonus, as he made the task so difficult that fewer of the workers could accom- plish them his bonus increased. If he set the task more reasonable and a larger number of the workers completed their task before the time set, he lost his bonus, so that the task setter was pitted against the foreman and the amount of his pay envelope depending upon his setting the task so high that but few of the workers could reach it, the foreman received his bonus, based upon the number of work- 'ers who earned their bonus, so that the time-study man and the fore- man were continually fighting each other over the question of the jobs, and naturally the foreman was using every possible means within his power to drive the workers under him to earn their bonus, because extra money in pay envelope for him depended upon his doing so. So that task and bonus or premium or the differential piece system has not been entirely satisfactory to some employers in de- termining the output that a human being is capable of producing every day. Mr. London. WilUyou allow an interruption here? Mr. Fret. All you want. Mr. London. Would an employer gain by setting the task so high that only a small percentage of the employees would come up to it? Mr. Fret. I could not answer that, iDCcause I am not an employer, any more than we could answer a good many questions like this, for instance : Why is it that employers used to force the employees to work from sunrise to sunset ? Why did they clean out the orphanages and other eleemosynary institutions in England, a few generations ago, and put the inmates into the cotton mills ? We can not answer those things. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 323 Mr. London. What I had in mind was that this was a temporary condition in this plant. Mr. Feey. No; this was the fixed policy. We found these three principal methods of payment in operation: Task and bonus, premium, and differential piece ; but they varied in almost every plant. In some plants the management felt that 35 per cent bonus on the hourly rate was the necessary bonus to secure the fullest output from the workers. In other plants we found that they thought 20 pier cent was enough. We also found that there were combinations or branch, lines from these main systems, so that we found in all some 27 different forms of those three basic methods of payment, each one endeavoring to stimulate the workers to the right degree. I want to say, in justice to some of the efficiency engineers and some of the firms, that they were conscious of the danger of overspeed- ing labor, and, while they might set their tasks high, they were un- willing that the workers should exceed the tasks set, and they penal- ized a worker for doing much more than the task set, some of them by removing the hourly wage rate, so that if it was a 10-hour day and the operator performed the task within an hour, within the time set, and earned a bonus each hour, if they exceeded their output, and would make the " ninth shoe " that was spoken of this morning, they were penalized by merely getting their bonus and not getting over the 8-hour rate. But we only found four firms that had made a definite effort to prevent overexertion. In all of the others we found such conditions as I have called attention to, as added stimulus to go the limit. Mr. London. Four out of how many ? Mr. Feet. Thirty-five. We also found that it was almost impossible to secure any scien- tific basis for a comparison between these various forms of payment. We could submit a good many figures to you sTiowing that under a bonus system, at a certain basis, a worker would receive 15 or 20 per cent more total earnings in a week than under some other system for the same number of pieces, but I am not going to burden you with that. I will simply say that if the committee desire we will have the mass of figures worked out in Mr. Hoxie's book, and it would be too dry reading to submit at this time, but very valuable. I merely want to say that this subject was minutely analyzed. Per- haps I can call your attention to this — I am just reading from my own field notes now, and I leave out the names of the efficiency engi- neers who were with us on this trip : I asked on the way down, discussing the tasks and bonus, the task and premiums with '■, and -, and if a man beats the task — ^that is, should the man on a task set for 10 per day put up 11, would he receive the full time allowed for task and bonus on the eleventh and twelfth piece ? Under the premium system at — manufacturing company, if the task was 10 and the man put up 11 or 12, he would receive but one-half the total time around for all over 10. I might say that that is the Halsey system that is in vogue at the Watertown Arsenal, where instead of the man on the ninth shoe get- ting $1.50, the time is set, the man is paid one-half of all the saving 824 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. that he makes: Example, if 100 pieces a day are the required task to receive bonus at and the basis was 33J per cent, and 3 cents per piece allowed. This would give the worker $4 for his day's work. If he put up 50 pieces in addition, this would give him $2 more, making his earnings $6. At the Co., if the task was 100 and the price equivalent of 4 cents, the man would get $4 for the 100, and half of that price for all over, so that but 2 cents would be given for all over the 100. If he made 50 more, he would get but $1, making $5 in all. There- fore, under the task and bonus system, one worker in one plant would receive $6 for 150 pieces, and in the other plant, under the premium system he would receive $5 for 150 pieces. Both of these plants were in the same city, and both used the same time study and task setting methods, but one paid bonus and one paid premium. There would be a difference of $1 a day in the earnings in such an instance as just cited. Mr. London. The same number of hours? Mr. Fret. The same number of hours; yes, sir. I find the time, Mr. Chairman — the time is passing, and I wanted to go into greater details in some of these matters, and I must touch on the Watertown Arsenal — I would like briefly to say something about speeding up, and then pass from that to what I think is an even more important feature. Here, again, instead of making this an oral statement, I will con- dense by reading the joint conclusions reached by Mr. Hoxie and indorsed by Mr. valentine and myself: A much more definite issue is brought up by Mr. Taylor's claim that " scien- tific management " guards the workers against overspeeding and exhaustion through careful studies of fatigue and the setting of the task on the basis of a large number of performances, by men of different capacities and with due and scientific allowance for the hutfian factor and legitimate delays. It has been pointed out already in the discussion of time study that tasks are set in all sorts of ways, with reference to the men chosen and the number of performances timed. There is no general rule. And it was also demonstrated that uo scien- tific method had been developed for the making of human allowances, and that these are sometimes very liberal, but sometimes also unduly curtailed. It must be admitted on the other hand that " scientific management " can and often does go far through the study of machinery and the careful observation of the on- going process of production toward the establishment of proper allowance for legitimate delays, not • connected directly with the human factor. When we come, however, to the matter of fatigue studies, and their connection with speeding and exhausion, Mr. Taylor's claim seems to break down completely. No actual fatigue studies were found taking place in the shops, and the time- study men employed, who should be charged with such studies, seemed, in gen- eral, to be quite indifferent or quite ignorant in regard to this whole matter. Fatigue studies apparently are not made when the tasks are set, and, if after- wards complaint is made, tlie classical method of dealing with the subiect is to " demonstrate " to the worker that the task can be done in the time set. Efforts to discover from " scientific management " experts proper methods for studying fatigue brought out only vague replies. Were it not for certain examples cited in " scientific management " texts, tliere would seem to be no ground for credit- ing it with any scientific aspirations in this connection. This does not mean that no attention to fatigue is given in " scientific management " shops. Cases were found where the health and energy of tlie workers were carefully observed and attempts were made to adapt the work to their condition, but the methods employed were the rough and ready ones of common-sanse observation. Mr. Feey. In one plant, and the gentleman who owns this plant is a very highrgrade man in every respect, a good citizen, with an METHOD OF DIBUCTING WORK OF GOVERNMENT EMPLOYEES. 325- interest in the welfare of his employees, scientific management, in- stead of keeping him informed of what is going on in the plant, pre- vented him from discovering a great many things. There we found overstrain in more than one instance. There was one machine in the plant, perhaps as long as this table [indicating] which is oper- ated by a foreman, or what was called a straw boss and a man assist- ant. On this side of the machine [indicating] were five girls who took the material from a table farther away and placed it into com- paj-tments as the machine went around, and gathered this, material up. At the other end three girls picked up the finished product of thfi machine and put it away. The bonus depended on gang produc- tion. If there was any interruption in the production it meant per- haps loss of the bonus. This gentleman wanted us to discover how the employees felt toward scientific management, and we were given the privilege of interviewing many of them, one by one. We dis- covered that the five girls who fed the material into the machine on this side [indicating] — each fed two bins — when they wanted to answer calls of nature they had to stop the machine, and the fore- man raised the dickens, because there was a break in the production, and the ^rls had got to the practice of taking cathartics to prevent loss of time during working hours, because they found,, with tha gkls leaving intermittently, that they could not keep the bins, filled over a minute at what they were forced to keep their own and the absent girls supplied. It was, found that the girls could not answer calls of nature and keep up with the time which was set for the performance of the task. As indicating that, all the scientific management experts are not of the opinion that the day's work or task should not be exceeded, or that speeders-up should not be employed, Mr. Parkhurst read, a paper before the American Foundrymen's Association,^ in which he described how he had introduced the system in one of the. establish.- Bients in Detroit, He advocates the breaking or records,, and advo- cates the stimulating of the men by pacemakera, I will quotja this brief sentence from his paper : They have gang production there im th« foundry, and the same taen have been running the job far some time. Here he says: Tfhese same men asked to be told a day or two before the pattern went out o'f the sand — That is., before the order was completed — so he and his gang could put up a record that no other gang could touch. It is from such records, plus the time studies, that the records for performance are established. We found this : That the tendency of scientific management is to bring about an autocracy in industry. They all told us it was im- possible to successfully work out the methods of scientific manage- ment if there was such a thing as industrial democracy ; that their methods were accurate; they knew what they were doing, and that these features were not more subject to collective bargaining than the question of whether the sun sets in the west or the compass, points to the north; that when they demonstrated anything scientifically 326 METHOD OF DIKECTING'WOEK OF GOVERNMENT EMPLOYEES, that was the end of it, and therefore there could be no collective bargaining ; that the methods of scientific management are the com- plete negation of what we call industrial democracy. We found but two plants in the country where methods of scientific management were applied, where union men were employed. In one of the plants union men were only employed in one department, and in that department there were no negotiations with the com- pany relative to wages. In other words, while they were members of the union, the union in no way took up terms of employment with the management. As to the other plant where union men were em- ployed, they were employed as the result of a boycott that was na- tion wide and the company's product had become so seriously af- fected because of these labor troubles that they had entered into an agreement with the unions shortly before we visited the plant and they were trying to continue the system under union labor. Those are the only two cases where union labor was employed under scien- tific management to my laiowledge with the exception of the Gov- ernment navy yards and arsenals. Mr. London. In those places, what did you find the attitude? Mr. Fret. They were so bitterly opposed they were waiting for the system to be thrown out or go on a strike. I should like to call tlie committee's attention to what I have to say on pages 21, 22, and 23 of my report and pass over without touching on it. Mr. IDEATING. You will insert that in the record? Mr. Fret. Yes, sir ; because that deals with this question of indus- trial democracy. There is one tendency of scientific management that, to my mind, is perhaps as serious, and that is that the motion studies made in connection with the time studies, aim to transfer to the firm, as the firm's property, what we call craft skill, or craft knowledge and manual skill. They aim to supplant the skilled labor with lesser skill or unskilled labor. To illustrate : in one of the large establishments that I speak of where they had standardized the length of threads, there were a number of men who had been in the company's employ from 15 to 25 years whose wages on that work ran from $33 to $38 a week When they introduced this system of subdivision they called in these men and gave them two weeks' pay for faithful service and let them go and put in women, who received only one-half of what these men had previously gotten. The object of scientific management is to subdivide the skill so that a little bit can be done by one workman and a little bit by another. To use an illustration, tifiey will study a barber, so that in the barber shop there will be one man who will be doing nothing but getting water and keeping it at the right temperature ; one barber or man to work Up the lather ; another to apply it ; another man to do the shaving ; one man to do the stropping ; another man to wash your face, and to wipe your face with a towel Mr. London. How about the man who does the talking? Mr. Fret. Oh, they would have a phonograph for that. It is that subdivision that is dangerous, and I v^ould like to have inserted in the record an editorial that appeared in the International Molders' Journal, on pages 26 and 27. It shows the gist of this tendency. Mr. Keating. Without objection it will be inserted at this point. METHOD OS- DIEEOTING WORK OF GOVERNMENT EMPLOYEES. 327 (The document referred to is as follows:) MODERN INDUSTRY AND CEATT SKIIX. The one great asset of the wageworker has been his craftsmanship. We think of craftsmanship ordinarily as the ability to manipulate skillfully the; tools and materials of craft or trade. But true craftsmanship is much more than this. The really essential element in it is not manual skill and dexterity, but something stored up in the mind of the worker. Tliis something is partly the intimate knowledge of the character and uses of the tools, materials, and.' processes of the craft which tradition and experience have given the worker. But beyond this and above this, it is the knowledge which enables him to understand and overcome the constantly arising difficulties that grow out of variations, not only in the tools and materials, but in the conditions under- which the %vork must be done. In the past, for the most part, the skillful manipulation of the tools and ma- terials of a craft and this craftsmanship of the brain have been bound up together in the person of the worker and have been in his possession. And 11 is this unique possession of craft knowledge and craft skill on the part of a body of wageworkers — that is, their possession of these things and their em- ployer's ignorance of them— that has enabled the workers to organize and force better terms from the employers. On this unique possession has depended more than on any other one factor the strength of trade unionism and the' ability of unions to improve the conditions of their members. This being true, it is evident that the greatest blow that could be delivered against unionism and the organized workers would be the separation of craft knowledge from craft skill. For if the skilled use of tools could be secured from workmen apart from the craft knowledge which only years of experience can build up, the production of " skilled workmen " from unskilled hands would be a matter in almost any craft of but a few days or weeks ; any craft would be thrown open to the competition of an almost unlimited labor supply; the' craftsman in it would be practically at the mercy of the employer. Of late, this separation of craft knowledge and craft skill has actually taken place in an ever widening area and with an ever increasing acceleration, Its process is shown in the two main forms which It has been taking. The first of these is the Introduction of machinery and the standardization of tools, materials, product, and process, which makes production possible on a large scale and the gpeclalization of the workmen. Each workman under such cir- cumstances needs and can exercise only a little craft knowledge and a little craft skill. But he is still a craftsman, though only a narrow one and subject to much competition from below. The second form, more insidious and more dangerous than the first, but to the significance of which most of us have not yet become aroused, is the gathering up of all this scattered craft knowledge, systematizing It and concentrating it in the hands of the employer, and then doling It out again only in the form of minute Instructions, giving to each worker only the knowledge needed for the mechanical performance of a par- ticular relatively minute task. This process it is evident separates skill and knowledge even in their narrow relationship. When it is completed the worker Is no longer a craftsman in any sense, but is an animated tool of the management. He has no need of special craft knowledge or craft skill, or any power to* acquire them if he had, and any man who walks the street is a competitor for his job. There is no body of skilled workmen to-day safe from the one or the other of these forces tending to deprive them of their unique craft knowledge and skill. Only what may be termed frontier trades are dependent now on all around craftsmen. These trades are likely at any time to be standardized and systema- tized and to fall under the influence of this double process of specialization. The problem thus raised is the greatest one which organized labor faces. For if we do not wish to see the American workman reduced to a great semiskilled and perhaps little organized mass, a new mode of protection must be found for the working conditions and standards of living which unions have secured, and some means must be discovered of giving back to the worker what he is fast losing in the narrowing of the skill and the theft of his craft knowledge. It is another problem which the organized workmen must solve for themselves and for society. 328 METHOD OF DIRECTING WOEK OF GOVEENMENT EMPL0YKS3- Mr. Fhet. Before passing to the Watertown Arsenal, I would like to read the statement that Mr. Hoxie, Mr. Valentine, and I prepared after we had finished the Hoxie report. It contains the substance of our joint conclusions, and I will read it for the benefit of the com- mittee : Two essential points stand forth. The first point is that " scientific manage- ment," at its best, and adequately applied, exemplifies one of the advanced Sitages of the industrial revolution which began with the invention and introduc- tion of machinery. Because of its youth and the necessary application of its principles to a competitive state of industry, it is in many respects crude, many Of its devices are contradictory of its announced principles, and it is inade- quately scientific. Nevertheless, it is to date the latest word in the sheer mechanics of production and inherently in line with the march of events. Our industries should adopt all methods vsrhich replace inaccuracy with accurate knowledge and which systematically operate to eliminate economic waste. " Scientific management " at its be.st has succeeded in creating an organic whole of the several departments of an institution establishing a co- ordination of their functions which had previously been impossible, and, in tliis respect, it has conferred great benefits on industry. The social problem created by " scientific management " does not lie in this field. It is in its "direct and Indirect effects upon labor that controversy has arisen, and it was in this field that the investigation was principally made. For the present, the introducers and appliers of " scientific management " have no influences to direct them, except where labor is thoroughly organized, other than their ideals, personal views, humanitarianism or sordid desire for immediate profit with slight regard for labor's welfare. The second point is that neither organized nor unorganized labor finds in " Scientific management " any adequate protection to their standards of living, any progressive means for industrial education, or any opportunity for indus- trial democracy by which labor may create for itself a progressively efficient share in efficient management. And, therefore, as unorganized labor is totally unequipped to work for these human rights, it becomes doubly the duty of' organized labor to work unceasingly and unswervingly for them, and, if neces- sary, to combat an industrial development which not only does not contain conditions favorable to their growth, but, in many respects, is hostile soil. Mr. Fret. While scientific management has said a great deal about training the worker and making him efficient, with but one or two exceptions we found no apprenticeship system. We found they were opposed to apprentices; that they believed that the old-time mechanic was no longer necessary, and that they could specialize the work so as to get along without them. The Watertown Arsenal has an apprenticeship system. Col. Wheeler told us at that time they had 11 apprentices in that plant. We found plants where they had previously had an apprentice system, that they had eliminated it. One of the officials of a plant, witn reference to apprentices said to us : We can not take a man under apprenticeship and let him do different things for four years and then pay him $21 per week. We must put him on one job and keep him on one job. There are some boys and girls in the composing rooms, and I would like to teach them to become printers, keyboarders, proof readers, make-up men, stone men, and teach them two or three phases of the business, but I have the threat In the back of my head that at the end of four years I must make them earn $21 a week, and I can go at the end of the four years and get a much better workman for the money, so I must keep them on one job. In other woVds, under this system, he depended on hiring men that other employers had trained, but was not willing to pay for training the men himself. Mr. Keating. In your judgment, it practically wipes out tlie apprenticeship system? METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES. 329 Mr. Fret. Absolutely. Mr. Keating. It affords the worker no opportunity to leara hia trade? Mr. Fret. Absolutely not. For instance, one gentleman who came before us and spoke about his plant, and the ideal conditions existing there said with ref erenca to apprentices: Where you manufacture you must specialize, and a first-class all-around mechanic can do better, using all his knowledge. We decidedly do not have the facilities here for making first-class, all-around mechanics; a specialist ta more valuable to the company. I think, Mr. Chairman, that inasmuch as you want to know some^ thing, or I think you do, about the Watertown Arsenal, it might b© well to refer to that at this time. Mr. Keating. I think the committee would appreciate testimony on the Watertown Arsenal. Mr. Fret. I will say that I have here our field notes taken during our investigation of the Watertown Arsenal. I also have the results of the investigation made by Mr. Miner Chipman, who is an efficienqy expert, who was trained under Mr. Harrington Emerson originally, and later on went into the business himself. Mr. Smith. How long a time was he in obtaining these field notea from the Watertown Arsenal ? Mr. Fret. I do not know how long Mr. Chipman devoted to that Mr. Smith. How long did you spend yourself? Mr. Fret. Three or four days. Mr. KEATING. For this entire investigation, how long a time did you spend? Mr. Fret. Sixty days in the field, but I have been studying thia question for a good many years. This might interest the coinmittee. Here is a card I got from one of these scientific managers himselJ, and here is the information they require about an applicant for work before they will give him a change to go to work : " Name, residence, age, height, weight, color, nationality, education; married or single, yelatives employed in this company; number and relation of rela,' tives ; had he been previously employed ; children ; religion ; politica; union or nonunion," and then there is also thatphy^cal examination of the eyes, ears, heart, lungs, and kidneys befort they are able to get a job. Before going to Mr. Chipman's evidence, which you will find in- teresting, and some of it charted, let me say that there has been a great deal of controversy over the Watertown Arsenal and the condi-? tions that exist there. There have been very contradictory statements in reference to it. I merely want to call the attention of the commit- tee first to some facts that came under my own observation. The jobs were set through time studies made very largely by a Mr. Mer- rick. The jobs were set very unevenly. Theoretically, when a job has been time studied and motion studied by an efficiency expert, accu- rate time should be set. There should be no marked variation in the difficulty of performing one task over the other. In the Watertown Arsenal, we found most extraordinary condi- tions on a number of jobs. I am a molder by trade, and worked at it some 15 years, and for almost 20 years, I have been an officer of the 330 METHOD OP DIRECTHiTG WORK OF GOVERNMENT EMPLOYH(".f' Holders' Union in one capacity or other. So, I am thoroughly familiar with foundry conditions, at least in my own trade. I will call attention to three jobs — I could call your attention to many more, but it is not necessary — one of which was a- little square band, made in a flask. This box was a small one, 14 inches by 14 inches and 7 inches deep. This band was made in this small bench flask, and finally they changed the size of the band and made it smaller. Now, while the' band was made a little smaller, it required identically the same amount of work to make the mold; the same amount of sand had to be rammed, and the same motions gone through. But they took off five minutes when they made the pattern a little smaller on one side. They took five minutes off because they made the pattern smaller, though this had made no difference in amount of labor re- quired to produce it. On another job, steps for a gun carriage. The steps had diamond shapes on them. They were made one pattern in a flask. They later on made a smaller pattern and were able to put two in the same flask. These two patterns, however, were larger and occupied more space than the single pattern, and it was necessary for the molder to run nails through the sand between these two patterns to keep the mold from breaking down when the iron was poured in, so that the molder had the work of securing the sand between the two patterns ; had two patterns to draw instead of one, and instead of allowing the same time on the job, they cut off one half an hour's time, all under scien- tific management. A more extraordin9,ry incident was the molding of a hand wheel — now, I may be wrong in the name of the hand wheel, but on the job, 1 am right. It was for a 14-inch and 16-inch gun carriage. The original job had been made for some time, when the new hand- wheel pattern was brought in. I am speaking of these jobs, having seen them and discussed these in front of Col. Wheeler and Maj. Wesson, who was responsible for setting the time. The new hand-wheel pattern was identically the same as the first one with one or two minor exceptions. The bead on it and the oval of the arms was practically as deep. I can assure the committee, in making the joint or parting, there was practically no difference, but the new wheel had this difference, that the hub was 2 inches shorter than the hub in the original pattern. They took off two hours and a half time for 2 inches less sand that the man had to shovel and ram in the drag. I think I am Well within the mark when I say that the average molder would not take over five minutes and go easy, to shovel in the extra sand and do the extra ramming in the drag. When they reduced the hub 2 inches, by some hocus pocus they cut two and a half hours off the job. I could weary the committee by taking up one piece after another^ but I do not think it is necessary. The employees of the Watertown Arsenal became interested in what scientific management was doing. They became concerned, and they finally went to Mr. Minor Chip- man, whose offices were in Harvard Square, Cambridge, and who had a staff of highly trained men with him, and he consented to make an iactual investigation of the results in scientific management in the Watertown Arsenal. This [exhibiting book] is what he discovered. This is his report, and it is worth its weight in gold, because you Ean not get any more. He had access to some of the Government Missing Page Missing Page METHOD OF DIKECTIKG WOEK OP GOVERNMENT EMPLOYEES. 331 records. In addition to that, some 221 employees furnished Mr, Chipman with information as to their work, as to their opinions relative to scientific management, and why they held them. Now, if there is anything scientific in time study and task setting,' 1 will say it is something in the evenness of the jobs and any serious errors not being made in setting the time for the task. But we dis- cover instances where the time-study man had made such serious mistakes as the difference between 8 J hours time to make a job and 27 hours. I have here three charts showing the efficiency of certain workmen in the plant during a month, indicating that instead of the tasks having been studied with any degree of accuracy, that the tasks were unbalanced so that at times the men could only make 21 per cent efficiency on the job and sometimes 200 per cent. It is the best evidence I know of, of the absolute unworthiness and unscientific character of time studying. I think the committee should see this chart. (The charts were thereupon exhibited to the committee.) Mr. Fret. This is a record of employee No. 2518, being for tho month of April, 1914. He was a very high-grade man. His average efficiency for the month was 121 per cent. Here is 100 [exhibiting]. Had the job been set with scientific accuracy, a man working nor- mally would show a straight line running along here [exhibiting], but instead of that, he produces more than the standard, and his average was 121 per cent. This zigzag line is the job he worked on. In this one he made 172.9 per cent efficiency, where here [exhibiting] he was able to accomplish only 45 per cent efficiency. This is evi- dence, as far as this workman is concerned, that instead of the time bieing set accurately, it was set very ridiculously and very carelessly — more carelessly than anything you would expect to find in any well- • managed establishment. * Mr. London. Was he working all the time on the same kind of work? Mr. Feet. No, sir; working on different jobs. A job would com^ in and he would be allowed so much time to perform the work., if the time was set accurately, he would have 100 per cent efficiency. Mr. London. Occasionally he fell below 60? ' ' Mr. Feet. He fell to 49. Mr. London. Is not that a case where he was asked to do work he was, not accustomed to? ■ Mr. Fret. No, sir; but the time being set so short, it was impos- sible of accomplishment. ' Mr. Keating. All this work was in line of Ms trade ? \ Mr. FEEr. He was a machinist, and these are different jobs given to him on his machine. ; Mr. Keating. You say this man was a high-class machinist? Mr. Feet. Yes, sir ; his number is 2518. I have not his name, but he is a very high-class man, and his work is a matter of Governmenfi record. Here is a man [exhibiting] on another job. This is another high-grade man. Here is a low-grade man [exhibiting]. His aver- age efficiency through the period was only 96 per cent. We find a very remarkable variation here [exhibiting] . Although his average was only 96 per cent for the period October 1, 1912, to September 30; 1913, his efficiency went as high as 149 per cent on some jobs. On S32 METHOD QV DIRECTING WOKK OF GOVERNMENT EMPLOYEE.-J. this job here [exhibiting] he went as low as 39.3 per cent. It is &n~ dent that so far as setting the times are conQerned, there was no scientific accuracy about the thing at all, when we get the facts and get away from theory. Mr. Keating. Have you a third man's record there ? Mr. Fret. Yes, sir; this is a third man [exhibiting]. I do not want to take up more time. It is really an extraordinary one. It ig tJbe same workman. No. 2518. During this time his average effieienaj was 121.35 per cent. In other charts hia efficiency was only 121 per cent. This month his efficiency was a little higher. In this job ha actually did the job in one-half the time that had been set for it. On this job [exhibiting] he was only able to accomplish 21 per cent of the work which the time card called for. Mr. London. How was th^ standard of 100 per cent determined? Mr. Fret. Congressman, that is what I tried to explain in my general statement in the beginning. There is no standard except an individual's time study, and that man's idea as to what the standard should be. Mr. London. Referring to the arsenalj how do they fix the* standard? Mr. Frey. Out of their heads. There is no standard in exist^K» except what they want to establish. Mr. Keating. Have you copies of those diagrams, Mr. Frey ? Mr. Fret. No, sir ; I have already said that this is a most valuable irecord which I have. Mr. Nolan. Is there any way by which the committee could bor- row this and then return it ?. Mr. Fret. I will loan this to the committee, but I would want ta hold the committee responsible for it- Mr. Keating. If the committee wanted to. reproduce the three charts it will only be necessary to send Mr. Frey to some photo- grapher to have it done. It is not necessary to take the book out of Jiis possession except to have the photographex make copies of these charts. Mr. Nolan. Can you have a photographer make copies and suboul them to this committee to be incorporated in your testimony ? Mr. Fret. Yes, sir. I want to quote now a moment from my own field notes during the interview we had with Col. Wheeler, in which I was taking up the jobs in the machine shops: Cuse No. 1. — First a time of 5 hours was set on a job by tlie time study man, but this was found to be insufficient and 12 liours was allowed, and latet on it was increased to 19 hours as the time study man found he had made a mistake in changing the gears. Case No. S. — The premium had to be given up, because the time study man found that there was no telling what was to be done until the job had been completed. Case No. 3. — The time on the job was set at 8i hours ; later on it was found necessary to allow 27 hours time for making the job, the time study man having made a mistake of 184 hours on a 27-hour job. Case No. J/. — The time study man set a time of 5 hours 36 minutes on a job which it was found necessary to set 12 hours and 54 minutes on when this machinist was able to have his complaint heard by a higher authority. In case No. 1 they discovered that somebody had changed the gears in the machine, without notifying the time study man or the task setter, but the machinist had to bear the entire burden of that thmg himself. Missing Page METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. 333 On another job, case No. 3, a time of eight hours and a half had been set. 'I'he machinist claimed that he could not possibly finish the job in that time ; that it was an inhuman task, and later a study was made and it was discovered that they had made an error in the plan- ning room and eventually the time was set at 27 hours. So, after the job had been given to the workman with 8^ hours to perform it, it Was necessary eventually to allot 27 hours to the job. I want to call attention to this not that it was a great error, but the fact that it is only those kinds of errors that give the workmen much of a chance to be heard from, or to get a hearing from the management, and it is the hundreds and thousands of mistakes of less size than this that bear down and harass the workmen and leave them with no oppor- tunity to get a hearing. While, of course, these are extraordinary mistakes, just as many mistakes are occurring right along that do not show such a remarkable margin of error as those. Another thing we found in the Watertown Arsenal that seemed to be very unfair to labor — and it seemed to be unscientific from a scientific viewpoint — was the practice of putting skilled men under the task bonus system and paying helpers who were with them straight day wages, which made the mechanic on the job a task mas- ter over the unskilled laborer, who only got a straight day's wages, and it saved them the trouble of having a foreman over men of that kind, because each mechanic would see that the helper was hitting the hay as rapidly as possible, in order to get the bonus. Mr. London. On what basis was the day wage calculated? Mr. Feet. I do not know. I did not go into that. It had reached the point where some mechanics had found it necessary to, as they say, grease the laborer's pocket, and they paid out $2, $3, or $i a week to their helpers, in order to give them the necessary stimulus to put • up the day's work. But gentlemen, I think I had better open myself to questions. I am afraid if I get started on some of these things, with time passing — and I have not dug into the matter that I have here at all. One moment. I can not pass this. The point has been raised by Gen. Crozier and others that organized labor was opposed to scientific management because it was organized labor, and that unorganized labor was not. Out of 221 employees who sent informa- tion to Mr. Chipman, I find the following : There is evidence of deep-rooted objections to the system in the fact that so large a number — 221 — or 94 per cent of the 235 men who replied signed the letter authorizing Miner Chipman to go into the matter as their counsel in the matter. It has been claimed for years by the ordnance department that it was the •union men who were opposed to the Taylor system and who fomented agitation against it at the Watertown Arsenal. The answers to the question sheet show the opposite. A majority of those " opposed " to the Taylor system at the Watertown Arse- nal are nonunion men. The exact figures of the 214 " opposed " are : 113, or 52.8 per cent are non- union and 101 are 47.2 per cent are union men. Of the 16 " not opposed " 11 are nonunion men and 5 are union men. The answers to question 11, " Do you think the agitation is brought about through union labor or similar sources?" show 137 answering " no," 28 answering " yes," and 70 giving no answer. This is what the men themselves know to be true, and tliey are in a better position to know the truth than anyone else. Mr. London. Was that 7 or 17? Mr. Feet. Seventy, giving no answer, the point being that the unorganized workmen in the Watertown Arsenal showed a greater 334 METH'^D OF DIBECTING WORK OF GOVEEXMENT EMPLOYEES. opposition to the system, so far as numbers are concerned, than the union men themselves. There have been some statements as to the accidents in the Water- town Arsenal. Now, these are Mr. Chipman's figures. I presume he secured them from some Government records, because they are detailed and specific, and I have heard that Gen. Crozier has made the statement that the accidents have decreased, but that the figures he uses to indicate this are based not upon the number of men em- ployed and the number of accidents but rather upon the number of accidents in proportion to production. I do not want to say that is so. That is my understanding. The record here indicates that there was 6,628 men employed at the arsenal in 1909 and 6,127 in 1914, so that there had been a decrease in the number of employees, but in 1909 there were 286 accidents, and when the system got working well in 1914, there were 1,518 accidents or an increase of 428 per cent_ in the number of accidents in a period of five years, under which scientific management was in operation. Mr. London. You have not the number for the year 1914? Mr. Fket. Yes, sir; I have given it. Mr. London. I thought it was 1909 and 1911. Mr. Fket. No, sir; 1914. The total number injured and absent from duty was increased from 236 to 566, or 135 per cent in five , years. Of those injured and absent from duty, the increases for the respective periods of absence, have been as follows : From to 5 days, from 87 to 229. From 5 to 10 days, from 37 to 75. From 10 to 15 days, from 13 to 37. From 15 to 20 days, from 44 to 101. From 20 to 25 days, from 13 to 34. From 25 days and aver, from 46 to 90. Injured and not absent, from 50 to 952. I want to call the committee's particular attention to the enormous increase in loss from 15 to 20 days, and also the number of days loss from 25 days and over — ^being from 46 to 90. Mr. London. To what do you attribute that? Mr. Feet. The nervous strain on the men; the failure of the theory of scientific management to work in practice. Accidents would decrease if the theory worked out in practice, but our experi- ence was that practically every theory as announced by any of the leading efficiency experts, so far as labor was concerned, fell down in practice, and very frequently the practice was directly opposite to the theory. I have a large number of workers' opinions here in which they give their reasons why they are opposed to scientific management. Mr. Keating. In giving your testimony, you said in a certain year more than 6,000 men were employed at the Watertown Arsenal. Mr. Feet. Yes, sir. Mr. I^ATiNG. As a matter of fact, is not the working force of the arsenal 600? Mr. Feet. I will go right back to my figures. I said I am quoting from Mr. Miner Chipman's records. I did not gather these figures myself. No ; he had 6,628 in 1909 and 6,127 in 1914. Whether that means the total number of those employed or not, I do not know. I do not know where he got the figures, but these are the figures he METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES. 335 has. One moment. This is from the report of the Chief of Ord- nance, and I talce it that it covers all of the arsenals. I believe I turned over one page too many. Mr. London. And the number of accidents you spoke of related to all arsenals? Mr. Fret. They must have referred to all arsenals. i' Mr. Keating. Have you the figures for the Watertown Arsenal ? Mr. Feet. I thought I was quoting the Watertown Arsenal fig- ures, but I believe it must have been for all arsenals. Gentlemen, I have hardly begun to uncover the soil, but, as I said in the beginning, I have so many facts that I have simply tried to bring out what I thought would interest the committee most and prove most valuable. Mr. Keating. If you should encounter the Watertown figures, it might be well to incorporate them in the hearing in connection with your testimony. Mr. Smith. About how many different industries employ the Taylor system ? Mr. Feet. It would be difficult to answer that (juestion. There is only one plant that I know of that has got nothing but the Taylor system and the other plants have partly the Taylor and partly some- thing from someone else. Mr. Smith. Do nearly all plants have shop management of one kind or another ? Mr. Feet. No, sir. Mr. Smith. What system has Ford? Mr. Feet. A system he developed himself. Mr. Smith. He has the welfare system, has he not ? Mr. Feet. Yes, sir. Mr. Smith. He looks after the workmen and sees to their com- forts and sees that they are provided for? Mr. Feet. Yes, sir. Mr. Smith. Do the workmen object to this scientific management? Mr. Feet. The workers that I talked with were either opposed to it or very strongly opposed to it. The only workers I ever found in favor of it were some of the functional foremen who received a bonus under the system. Mr. Smith. What have you to say about it being necessary^ — -scientific job management, as we are applying it here in this coun- try — being necessary for the interests of the manufacturers ? Mr. Feet. My own opinion is that scientific management so far as labor is concerned, is wholly unnecessary for successful production. That there must be something practical — sound common sense — in the management there is no question, but I feel that none of these systems, whether the system of Mr. Taylor, Mr. Gantz, Mr. Emerson, Mr. Parkhurst, or any of them, are at all necessary as far as the labor element is concerned. Mr. Smith. What harm do they do? Mr. Feet. Where they applied, they first of all prevent any adequate expression of the workers' desires or consideration of the workers' desires. They establish an autocracy in the industry. They make a few men — a group — do all the thinking and all the ordering. The system prevents the worker from thinking. 336 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. Mr. Smith. How long has it been in vogue? Mr. Feet. A very few years. Mr. Smith. And it is a new system? Mr. Fret. It is a new system ; yes. Mr. Smith. Are the workmen generally opposed to the piece system ? Mr. Feet. It all depends on the industry. In some industries the Workers favor piecework sometimes; and in others they are strongly opposed to it, and in some organizations, such as I am a member of, all the members who work on stove plate work on piecework, whereas, on other work, they can not work so well and are vigorously opposed to it. Mr. Smith. Where it can be worked, generally speaking, what is the sentiment ? Mr. Feet. As I say, so far as the workers are concerned, some are opposed and some are not. Mr. Smith. Are there not a great many workmen in the different industries in favor of the piece system ? Mr. Feet. I can not answer that. The cigarmakers work on piece- Work and probably prefer it. Mr. Smith. Are not all the manufacturing plants conducted on the piecework system ? Mr. Fret. I think so. Mr. Smith. Does not that take the place of the bonus system? Mr. Feet. No, sir. Mr. Smith, i ou think that is added to the piece system ? Mr. Feet. It is added to the piece system, because either under the task or bonus, unless you do so much, you get a great deal less. In piecework you get exactly in proportion to what you do. Mr. Smith. What objection has the workman to time study ? Mr. Feet. Some have the feeling that it is humiliating to have a man standing over your back, or around you, with a stop watch, checking off every movement you make, trying to catch you beating Some little time. Others object because it forces them to work harder and harder, and it puts into the employer's hands a power which they use unjustly against them. Mr. Smith. You think the general objection is that it overworks the men ? Mr. Fret. I should say from what the workers told me, that I interviewed, it was half and half. It was partly the feeling of humiliation in having someone staiid over them with a stop watch and others felt that the system meant making their work that much harder. Mr. Smith. What is the feeling of the workmen about the Taylor system ? Mr. Feet. 1 have not encountered one who favored it. All that I have interviewed are bitterly opposed to it. Mr. Smith. Are the workmen generally opposed to a bonus system? Mr. Fret. Some of the workers— I want to revise that statement as to the Taylor system. I found some workers working under the "taylor system who said they did not consider it hurt them much. Mr. Smith. But, generally speaking, you think you are safe in sayiiig they are opposed to it? « " METHOD OF DIKECTING WORK OF GOVERNMENT EMPLOYEES, 337 Mr. Feey. Yes, sir. Mr. Smith. Are the M'orkmen generally opposed to a bonus? Mr. Frey. I found some who were not opposed very strongly to a bonus, but those were workers who had been trained in that sys- tem and knew nothing about conditions outside. Generally, I found them opposed to the bonus because they held that their bonus system or premium system robbed them. Mr. Smith. Do you think it should be abolished ? Mr. Frey. Absolutely. Mr. Smith. You think the workmen would be pleased to have it abolished ? Mr. Frey. Yes, sir. Mr. Smith. Is the same true of the premium system ? Mr. Frey. Yes, sir. Mr. Smith. What is the objection they have to that? There is nothing humiliating about that. Mr. Frey. The only objection to the premium system is, for in- stance, taking the nine shoes referred to by others — instead -of get- ting as much for the ninth shoe, the workmen would get only one-half. In other words, when they increased their output be- yond a certain point, they get only half. Now, under the task and bonus system, unless they complete the task within the time set, they do not get any bonus. In other words, if the time set for the job was 1 hour and the worker took 1 hour and 1 minute to complete the job, he would get absolutely no bonus. The bonus is an impor- tant feature. Some firms pay as low as 20 per cent, and I investi- gated a number where it was 33^ to 35 per cent. Mr. Smith. It is optional with the workmen to compete for it — it is not compulsory, is it ? Mr. Feey'. It is practically compulsory. He has to do the best he can, because the foremen generally are after the bonus, also, and prod him up, and if he does not get the bonus, he loses his job. Mr. Smith. How many States in the Union have statutes against the bonus or premium system? Mr. Frey. None that I know of. Mr. Smith. I take it, then, from your testimony, that the objection to the bonus and premium system is merely a matter of compensa- tion? Mr. Fbey. No, sir ; it is not merely a matter of compensation, but partly compensation and because it tends to drive the workmen to the limit of their capacity. Mr. Smith. Do you think generally the workman would be satis- fied if the premium and bonus systems were taken away from them — that opportunity to compete for that premium or bonus is taken away ? Mr. Frey. I think, in a large number of instances, that is what they want. Mr. Smith. How about the expert workman, who could do pos- sibly one-fourth more than the ordinary workman. We find a great many of them, because of their physical ability and muscular make-up, can do it with the same ease as the ordinary man. They should get more than the others. How would you work that ? Mr. Frey. They generally receive a different scale of wages. 36162—16 ^22 338 METHOD OP DIEECTING WOEK OF GOVEENMENT EMPLOYEES. Mr. Smith. Well, I have heard it stated that there should be some inducement for a person to exert himself or practice his pro- fession according to his ability, and if we do away with the premium Jind bonus system, there would be no inducement to do that. What do you say about that? . Mr. Fket. My experience is that the bonus system tends to make poor mechanics instead of good ones. I have figures, taken from the records, proving that the tendency of the task bonus system is to make the workers slight their work all they could, their only desire being to have it come so close to the standard as to be passed by the inspectors. Furthermore, as this work goes from one worker to another — ^it is subdivided — usually one does his share, owing to the skimping of the job by one set of workers, it makes it so much more difficult for the next group to perform their share. Mr. Smith. Do I understand from your experience with the work- men, they are not opposed to the piece system, then ? Mr. Fret. In some industries they are not opposed to piece work, and in some industries they apparently prefer it. However, in some industries, because of the character of the work performed in that industry, they are strongly opposed to it. Mr. Smith. There is not enough opposition to the piece work sys- tem to have that particular system come within the bane of the bill. It ought not to be interfered with by law? Mr. Feet. I think it should be prohibited on certain kinds of work. Mr. Smith. I think we should name the classes in the bill, do you not? Mr. Feet. I think it would be almost impossible to specify in the bill which work should not be done by piecework. To illustrate: A farmer has got a well-developed field. The soil is good. He has a reaper that works well. He might say, " I will pay you so much an acre for reaping this field." He will have, on another farm, very uneven ground, stones in the field, and perhaps a Virginia rail fence, where they have to get into the corners of the fence as well as in the middle of the field to do the reaping. In one field he could very well have that work done by the piecework, but in the other it would be absolutely impracticable. Mr. Smith. One thing is occurring to me, and that is one that I C{\n not satisfy myself on. We have a labor department in our State. We have a large manufacturing State, with a great many laboring men in the State. We have the largest paper mill in the world in my district, and in Detroit there are other large industries, but we have a lot of workmen petitioning the legislature there or the depart- ment of labor to abolish the bonus system, and that is what I want to get fixed in my mind — to satisfy myself whether or not we are doing the right thing with this bill. It seeks to abolish it. I want to know the effect of that with the workmen. I do not care about myself. I would like honestly to know just how the workmen feel about that. Mr. Fret. The workers of your State, if they should be of the same opinion as those I have personally interviewed Mr. Smith. In how many factories — ^how many will that cover? You have had a great experience, and I acknowledge that. Mr. Fret. About 20 plants. I spoke to the employees, and some of them I had private rooms set apart and had an opportunity, to talk with them one by one. METHOD OF DIEECTING WOHK OP GOVERNMENT EMPLOYEES. 339 Mr. Smith. Have the workmen passed resolutions to abolish these two systems? Mr. Feey. Yes, sir ; the convention of the American Federation of Labor and the State federations have done so. Mr. Smith. Abolish the two systems? Mr. Fret. Yes, sir. Mr. Smith. Well, they ought to know what they want. Mr. FuEx. Yes, sir. Mr. Keating. You are familiar with the attitude of the workers in the Government plants which would be affected by this bill? Mr. Fret. Yes, sir. Mr. Smith. What have you to say as to their attitude ? Mr. Fret. When the stop-watch system was invoked, one of the unions struck. I think it is the only one instance in history of a Gov- ernment employees' strike. Mr. LoKDON. Now, is not the piecework system just as objection- able — the bonus and premium system ? Mr. Feet. It has some of the objectionable features. Mr. London. Have you ever considered the question of the mini- mum wage in industries? Mr. Feet. Why, I have spent a great deal of my time trying to establish a minimum scale for molders. Mr. London. On the piecework system? Mr. Fret. No, sir; on daywork. Mr. London. Is not the daywork system not far removed from the piecework system? Mr. Fret. Under certain conditions labor can be forced under any system — daywork, piecework, bonus, or premium. I can conceive of a task in one plant with the bonus and premium system where the workers would work easier than in a daywork shop. That is merely a matter of what might be Mr. London. Then daywork, piecework, bonus system, premium system — all of these systems differ wholly in the form and in the extent of their exploitation of the worker? Mr. Fret. I think that the principal difference is one of degree, but there are other considerations that have to be brought in mind, because, under scientific management^ there is a new machinery introduced in industry which never existed before. In other words, there is a coordination of factors in production where before there had been looseness, and it is that coordination, coupled with the sys- tems for speeding up labor, that makes it very much more injurious or so much more liable to be injurious than any other system. This afternoon I have been discussing scientific management in its relation to labor. I have not discussed scientific management in relation to production outside of the human element. If I did that you could see how these things coordinate in scientific management. You can not separate them from one another. They become an artic- ulate whole. Mr. London. You spoke of industrial democracy, which is a rather vague term — it is a newly coined phrase, is it not ? Mr. Fret. It is a term used to express a very intelligent thought. Mr. London. But it is newly coined, is it not? Mr. Feet. It is a modern term. 340 METHOD OF DIKECTING WOEK OF GOVERNMENT EMPLOYEES. Mr. London. Very much modern. Is not the real problem in which the worker is interested a question of duration of employment and regularity of compensation? Mr. Frey. Why, I would state that I think— I would have to put it a little differently — ^that the workers' greatest concern is their standard of living. Mr. London. And that is affected Mr. Frey (interposing). By hours, wages, conditions under which the labor is performed, etc. Mr. London. One of the conditions is regularity of employment ? Mr. Frey. Yes, sir. Mr. London. And any system of wages which fails to consider that is defective? Mr. Frey. Unscientific. Mr. London. Unscientific? Mr. Frey. Yes, sir. Mr. London. Have any of the employers who have introduced the efficiency system found difficulty in obtaining additional em- ployees ? Mr. Frey. Some have, but I should say it was not a general com- plaint. Mr. London. You referred to a case where old employees were paid two weeks' wages and were substituted by women ? Mr. Frey. Yes, sir. Mr. London. Have you had an opportunity to trace what became of those old men ? Mr. Frey. Yes, sir. Mr. London. What did become of them? Mr. Frey. They were thrown into the industrial scrap heaps and were unable to work at anything else. They were tailors — ^ladies' garment workers. Mr. London. You mean by " industrial scrap heap " — you are using again a phrase Mr. Frey. They were thrown into a labor market where there was no call for their services. Mr. London. They were thrown out of employment? Mr. Frey. They were thrown out of employment and were un- fitted to take up any other employment except possibly selling news- papers. They were unfitted physically from working as tailors all their lives ; they were unfitted to do laborious work. Mr. London. Has a system of old-age pensions been introduced in any factories where you found the efficiency systems introduced? Mr. Frey. Not that I know of. There were some welfare systems in some of them, to make it pleasant for the employees while they are there. I might say that in one of these establishments that was ad- vertised so cleverly here a few days ago, when one of the girl's nos- trils were offended by the odor from some other girl they called the welfare agent, and they would go to this girl and tell her to go down and take a shower bath. They kept the workroom smelling sweet. That might help some. Mr. London. None of the factories concern themselves with the basic wage, do they? Mr. Frey. Yes, sir; the basic wage bothers them a great deal. They are very, much puzzled over what to do with it. Their basic METHOD OF DIRECTING WOBK OF GOVEENMENT EMPLOYEES. 341 wage is what they call the wage in the district, or what they pick it out to be. May I read a little bit from my field notes for your in- formation? I had to cover another subject at the same time, but I think it will be interesting: A separate labor department is maiutained and a physical examination of emplo.\ees is made, but Mr. stated that he did not know the details or the form and extent of these examinations. Mr. • said that many of the tasks were not set as high as formerly as it was found that too many- could not reach up to them in practice. He has, therefore, favored liberalizing the tasks. This is a startling statement for if the tasks were originally set by scientifically determined standards, then they should not be changed. If they were set too high, then a mistake had been made either in the time or motion study, or the allowance for the human factor. This is proof of the large factor played by the Judgment of the task setter. I asked for a statement as to the basis which he had for the determination of the hourly rate, and this is his statement as read to him for his approval: ''The basic rate is determined by the rate at which intelligent workers can be satisfactorily secured regardless of trade-union rates or competitive conditions." On meeting Mr. the following day I carried this point further by asking whether he would accept the local wage rate as a basis and fix it as a permanent hourly rate. He said '• Yes." " If, then," I said, " you found the hourly rate in New York to be 50 cents and the Baltimore rate 30 cents, you would permanently fix these rates under your task and bonus system." He replied in the affirmative. " Would it not be unfair to the New York employers?" was my next question, and he said that he thought not. He evidently has given much more thought to pro- duction than to industrial and commercial economics. Mr. London. In other words, the basic wage rate is determined by local conditions? Mr. Feet. Yes, sir. Mr. London. And it is purely accidental? Mr. Fret. Yes, sir. Mr. London. So that the bonus or premium is based upon the wage which is accidental, which depends upon the law of supply and de- mand as it prevails in a particular locality ? Mr. Feey. Or the trade-union scale. Mr. London. That is, wherever there is an effective trade-union? Mr. Fret. Yes, sir. Mr. Nolan. Mr. Frey, Mr. Smith brought up a subject a while ago regarding legislation affecting the bonus and premium system and piecework system, and wanted to know if any States had adopted statutes prohibiting them. Is it not a fact that labor has not asked for any legislation of that kind, primarily due to the fact that if they did anything in the way of asking for that they would have to apply for an amendment to the Constitution? Mr. Frey. I presume that is one of the reasons they have not asked for it. Mr. Nolan. Congress itself is not being asked to enact legislation only so far as it affects the Government employees ? Mr. Feet. Yes ; that is right. Mr. Nolan. What attention did you find given by any employers operating scientific management to employees thrown out of jobs by increased production? Mr. Feet. Absolutely none, and we asked most of them about it and they would shrug their shoulders and say that that was none of their business. Some of them — one or two — one of those gentlemen who had those peculiar conditions in his plant that I referred to, was somewhat interested. He stated that it was too big a problem 342 METHOD OF DIKECTING WOKK OF GOVERNMENT EMPLOYEES. for him to solve; that he could not stop introducing efficiency sys- tems in competing with his competitors. Mr. Nolan. Did you find any considerable number of shops that you visited giving much attention to the question of fatigue studies? Mr. Frey. We found not a single instance where long-time fatigue studies had been made. We did find in five or six plants that short- time fatigue studies had been made — for a single hour on the job, most of them, but we found none that went beyond that. When we inquired about these fatigue studies, referred to so much in works on scientific management, each employer said there was no such thing in existence. Mr. Nolan. The reason I asked that question is that I wanted to follow it with another. What does your committee mean by " rough and ready methods " ? Mr. Frey. I presume that we should have used the term " common sense " instead of " rough and ready." What we had in mind was common sense — the common-sense rule that governs a man who is used to handling workers. Mr. London. You do not mean antiquated methods? Mr. Frey. I do not thinlc they are. We visited some shops which did not have scientific management and they were very successful in holding their own with shops with scientific management. Mr. Nolan. Testimony has been given before this committee that scientific management contemplates finding places for the man who are not found efficient for the task at which he has been working — they generally try to find some place in the establishment where he can fit in. Did your committee find any evidence to substantiate that statement? Mr. Frey. We found nothing of that kind in practice, Mr. Con- gressman. We further found that the very opposite prevailed, and that the so-called theory of selection for the job was wholly set aside in practice, and that, the workers' selection went about as far as seeing if he could perform the work under the time set on that one job, and keeping him there. Mr. Nolan. If he was found inefficient for that job, did you find any evidence to show that as a general proposition they sought some other place in that establishment where he could fit in? Mr. Frey. No, sir ; as a general proposition he was dropped from the pay roll. Mr. Nolan. Some statement was made as to the Ford shop. Have you ever visited the Ford shop? Mr. Frey. No, sir ; because none of the scientific management men claim that scientific management, as a system, had been introduced there. Mr. Nolan. Do you know whether a stop watch is used in the Ford establishment? Mr. Frey. I could not say. Scientific Management and Labok. [By John P. Fkey, editor International Moldcrs' Journal.] A few years ago there was introduced in several industrial establishments a system of management which was radically different In many of its features from any that had preceded It, and which Its advocates announced was revolu- tionary in its results. The system was called " scientific management." METHOD OF DIKECTING WORK OP GOVERNMENT EMPLOYEES. 343 Claiming thiit the system had been developed as the result of thorough- going and scientific research and investigation by highly trained industrial and mechanical experts, its advocates held that when applied to industry it would eliminate economic waste by systematizing and standardizing the elements of production. It was asserted that It would make the workers more efficient through the special instructions and training it provided for, that it would safeguard them from injustice and the arbitrariness of employers and foremen, protect them from overexertion and provide for higher wages than had previ- ously been paid, and furthermore that it would eliminate Industrial strife. Owing to Its application in part in Governiiient arsenals, and a strike by the union molders against some of its features as they were introduced in the foundry at the Watertown Arsenal, " scientific management " received much publicity. The House of Representatives appointed a committee, consisting of Congress- men William B. Wilson, William C. Eedfield, and John Q. Tilson, to Investigate the system as It had been applied in the Watertown Arsenal. In its report to Congress this committee sustained labor's contention that the system forced abnormally high speed upon workmen, that its dlscliplinary features were arbitrary and harsh, and that the use of a stop watch and the payment of a bonus were in,iurious to the worker's manhood and welfare. At a succeeding session of Congress a measure was passed which prohibited the further use of the stop watch and the payment of a premium or bonus to workmen In Gov- ernment establishments. When the Federal Commission on Industrial Relations began its work it was decided that a further investigation of " scientific management " shofild be made, and Mr. Robert F. Hoxie, professor of economics at the University of Chicago, was selected to undertake the work. The commission was fortunate In securing a man of Mr. Hoxie's caliber and training. For many years he had made a seclalty of industrial problems, and was familiar through personal contact and association with the viewpoint, mental attitude, and ideals of em- ployers and workmen, organized and unorganized. Throughout the Investiga- tion he was treading on familiar ground, insofar as the principal problems which have arisen in our Industries between the workers and the employers were concerned. Mr. Hoxie was to devote a year to his Investigation, and, as a part of this was to Include a personal examination of a number of Industrial plants which had applied the methods and principles of " scientific management," It was deemed advisable that he should be accompanied by two ipen whose training qualified them to act as expert assistants in calling attention to the actual con- ditions which would be encountered in these establishments, and their implica- tions. One of those appointed was Mr. Robert G. Valentine, ex-Indian Commissioner, and by profession an Industrial. counselor, who, during recent years, had devoted most of Ills time to the development of the personnel features In large estab- lishments. The question of Mr. Valentine's selection was referred to some of the leaders of " scientific management " before his appointment was confirmed by the Commission on Industrial Relations. The other expert was to be a trade-unionist, and I was honored with the appointment. The report which Mr. Hoxie submitted to the Commission on Industrial Re- lations was prepared after some 35 industrial establishments had been investi- gated and Interviews had been held with a much larger number of individuals connected with the management side. Including such leaders of " scientific man- agement " systems as Mr. Frederick W. Taylor, Mr. Harrington Emerson, and Mr. H. L. Gantt. Workers, organized and unorganized, and trade-union officials were also questioned. In connection with this report It should be said that from the day that the chief Investigator and his two assistants met to take up the field work there were daily conferences whenever they had jointly visited a plant, at which all Information secured was discussed and an earnest effort made to give the proper vi^eight and value to the sometimes conflicting statements of workers and employers which were secured in the establishments investigated. The Investigators were Impressed with the conviction that their work was not to compare one theory of management with another or to Investigate the theo- retical postulates of " scientific management," but rather to discover the actual conditions affecting labor which existed in Industrial establishments where the 344 METHOD OF DIRECTING WOEK OF GOVERNMENT EMPLOYEES. " system " was beinR applied and in operation. It was an investigation of " scientific management " as it affected labor, directly and indirectly. The report which was finally prepared by Mr. Hoxie, after consultation with his two assistants, was subjected to their criticisms and suggestions until finally a common agreement was reached, so that when it was presented to the Commission on Industrial Relations it had attached the signatures of the three who were in agreement with its contents. It is necessary before referring to the facts which were developed by the in- vestigation to indicate the prelimnary worls; which was done by Mr. Hoxie previous to the field investigations, for the lines along which the investigation was carried on were determined almost wholly by the results of this preliminary determination of the points upon which it was necessary to secure information. From the day that "scientific management " was given publicity, positive claims as to its great value to labor were made by its advocates, while as emphatic charges that its methods and practices were injurious to the workers were made by trade-unionists. Some of these statements were contained in books, magazine articles, and public addresses, while many of them were incor- porated in the congressional hearings which had been held and the testimony given before the Commission on Industrial Relations in the early part of 1914. These records were examined, and from them approximately 100 separate features of " scientific management " were secured which, its leading advocates claimed, were beneficial to labor. Practically an equal number of separate charges were made by trade-unionists against the system. This examination of the record, supplemented by personal Interviews with leaders of both groups, supplied two lists, one containing the labor claims of " scientific management " and the other the charges against it made by the trade-unions. Such lists, however, were liable to have their accuracy challenged, and to prevent such an issue from being raised afterwards they were submitted to high authority for revision and correction. The list of the labor claims of " scientific management " was submitted to Mr. Frederick W. Taylor, Mr. Harrington Emerson, and Mr. H. L. Gantt, and others, and as the Taylor and Emerson systems differ in some respects their respective modifications or statements were separately recorded. The final result, however, was a list of the labor claims of " scientific management " which had the stamp of accuracy and completeness placed upon it by the recog- nized leaders of the cult. The list of labor's charges against " scientific management ' was brought to flie attention of th^ executive council of the American Federation of Labor by Mr. Hoxie during the PliUadelphia convention of tliat organization in 1914. with the request that a committee should be appointed to examine the list, with the object of making such modifications, additions, or corrections as would be neces- sary to have it embody the trade-union viewpoint. A committte was appointed for this purpose, and afterwards the list of labor's charges was carefully gone over by President Gompers, First Vice President Duncan, and Secretary. Mor- rison. This list contained some charges whicli had been made by individuals, with perhaps insufficient evidence to prove their accuracy, but inasmuch as they had been made publicly they were allowed to stand. There were, therefore, two lists of statements, both of which had been given the highest indorsement as to their accuracy vv'hich it was possible to obtain. With these two lists before him Mr. Hoxie prepared a list of the vital points of difference between them. It was apparent that if the facts were to be acquired, detailed instead of gen- eral information would have to be secured, and that this might be systematically gathered a questionnaire was prepared, containing approximately 700 questions, the great majority so framed as to call for detailed information, and few per- mitting of a simple affirmative or negative answer. The questionnaire formed the foundation of the investigation, this being supplemented by the material gathered through personal investigations of plants where production under " sci- entific management " was being carried on. Mr. Valentine and I assisted Mr. Hoxie in the final revision of the question- naire, and when this had left the printer's hand the field work was undertaken, witli the object of securing such evidence as could be found which would justify either the labor claims made for " scientific management " or the charges made against it. The plants where the investigations \\ere made were representative establish- ments or those recommended or suggested by Mr. Taylor. Mr. Gantt, or Mr. Emerson as those in which the standard methods of " scientific management " METHOD OF DIEECTING WORK OF GOVERNMENT EMPLOYEES. 345 had been applied. These shops, therefore, afforded the most satisfactory field for studying " scientific management " at its best which could be secured. The plants visited covered a wide range of production, from cloth weaving, garment making, and the manufacture of large machinery to printing establishments, shops operated largely by semiautomatic and automatic machinery, departments where hand labor rather than machinery was required, and a Government arsenal. The term " scientific management " was originally applied to the system of shop management which had been developed by Mr. Frederick W. Taylor. At present it is popularly used to designate any one of the several systems of shop management which embody in part certain of the prominent features which were first introduced by Mr. Taylor. While all of the systems of " scientific management " have certain features in common, they also contain elements of difference, both as to their structure and the method of their application. It is, therefore, difficult to define " scientific management " in a manner which would satisfy all of the leaders of the several systems now in operation ; for all general purposes it may be said that the term designates any of the systems of shop management which claim to secure greater productive efficiency through the systematic standardization of the elements of production. A common feature of these systems is the planning out of the work by special- ists so that it may be most economically handled and routed through the shop, the grouping of machinery and its operation at full capacity, the time and motion study of all mechanical and manual movements, so that the machines' possibilities and the workers' manual capacity can be analyzed into their minute elements from which the task to be accomplished can be defined and fixed, and the stimulation of the worker through the payment of a bonus or premium, so that the task set will be accomplished. The investigation which was made indiciated that no plant had as yet ap- plied all of the features of any of the systems to the establishment as a whole, and that practically every employer had made modifications of whatever part of the system had been introduced. To illustrate the divergence found, the forms of wage payments may be taken. Originally there were three most prominently known, the premium, the task, and bonus, and the differential piecework. These may be termed basic forms, but some 25 or more variations of these were found to be in practice. Wide variations were also found in the manner of making time studies, and in the rules by which the worker's taslc was to be determined. It was also found that ' the same system, installed by the same efficiency engineer, would produce vary- ing results in different plants, as far as the workers were concerned, each general manager modifying or altering Ihe application of the system according to his temperament, viewpoint, and his knowledge of the human problems created by modern industry. The several systems of " scientific management " and their variations which were observed in actual operation were installed by efficiency experts or man- gers, whose names are prominent in the " scientific management " group, and no time was devoted to an examination of shops where " systems " had been Installed by any of the charlatans and fakers who, during recent years, have reaped a rich harvest owing to the employers' avariciousness or credulity. We were informed by the leaders in the established " scientific management " group that the number of charlatans and imposters far outnumbered those who were truly qualified as efficiency engineers and had secured a recognized stand- ing among business men. These quacks, they held, were largely responsible for much of the disrepute in which " scientific management " is held by many employers and workers. Referring to them one eminent efficiency engineer said : "At the present time there is a great dearth of men who are qualified by experience, training, and temperament to establish in industry the principles of ' scientific management ' and to develop a proper mechanism for the appli- cation of these principles. There are also some of these men who are perfectly sincere and honest In their efforts and do not realize their shortcomings or lack of qualifications. Others have regarded so-called efficiency engineering as a means of earning an easier living and making more money than they would otherwise be able to do in other fields." Another equally as well known efficiency engineer said : " One trouble is that there are a large number of fakers installing systems under the guise of ' scientific management,' and it is because of what they have done that workmen have just cause for complaint." 346 METHOD OF DIBECTING WOEK OF GOVEENMENT EMPLOYEES. One expert informed us that " there were more fake engineers in ' scientific management ' than in any other line," wliile one of the most prominent leaders salt! that the reason the competent efficiency experts had not succeeded in ex- posing all .of the fakers and Imposters was that these ouacks outnumbered them 5 to 1. No effort was made to discover how many fakers there were professing to introduce "scientific management," but from the statements made to us it would seem that there are a large number. Upon this subject the Hoxie report says: " ' Scientific management ' as a movement is cursed with fakers. The great rewards which a few leaders in the movement have secured for their services have brought into the field a crowd of industrial patent medicine men. The way is open to all. No standards or requirements, private or public, have been developed by the application of which the goats can be separated from the sheep. Employers have thus far proved credulous. Almost anyone can show the average manufacturing concern where it can make some improve- ments in its methods. So that ' scientific management ' shingles have gone up all over the country, the fakers have gone into the shops, and in the name of ' scientific management ' have reaped temporary gains to the detriment of the real article, the employers and the workers. " Just who these fake ' scientific management ' experts and time-study men are it is impossible to tell, since no recognized standards of judgment exist. Accusations, indeed, are plentiful, but your investigator would not be war- ranted in repeating these. What proportion of the numerous failures of so- called ' scientific management,' of the positive errors and evils of time study, task setting and rate making in shops under this name are due to the work of these fakers is another matter on which no judgment can be passed, though scientific managers have variously estimated the fakers as four out of five, or nine out of ten. The certainty is that this element exists ; tliat its representa- tives apparently can not be clearly distinguished and set ofC under existing circumstances from the more legitimate ' scientific management ' practitioners ; that the legitimate ' scientific management ' group seems powerless to eliminate or control it ; and that it exposes employers and workers to the losses and Injustices of crude and inaccurate industrial tinkering — all in the name of * scientific management ' and under the protection of its promises and claims." The quacks' work, however, was not investigated. The facts which were gathered, the impressions which were secured, and the tendencies which were observed were all acquired through the investigation of plants in which " sci- entific management " had been introduced by well known efficiency experts or managers. Tlie methods of introducing the systems varied according to the men, some going about their work iu a diplomatic maimer, others jamming it through with apparently little, if any, regard for the workers. The pre.«ident of one of the largest establishments told us that 's system of " scientific management " was without human element, and that the trade-unionists were not to be blamed for fighting it because of the language which he had used in connection witli labor. " If," he said, " I had introduced ' scientific management ' in the literal way In which interprets it, I would have had a revolution on my hands, and the workmen would have been no good if they had not revolted." From information secured it would appear that " scientific management " in its genesis gave but little, if any, consideration to the workers' rights and welfare, but confined itself closely to the problem of reducing the cost of production. When the system was first established it was largely applied to plants which had proved unprofitable through faulty management, with the purpose of again making them profit-making concerns, the efficiency engineer having charge of its introduction receiving his recompense only after the plants were able to again pay dividends. It would seem that the workers' welfare and his status as a human being, a mechanic and a citizen, did not receive much consideration until labor had rebelled against the system and directed attention to many of its features .which affected labor Injuriously. TIME AND MOTION STUDIES. "Time and motion study," said Mr. F. W. Taylor, "is the accurate, scien- tific method by which the great mass of laws governing the best and easiest METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 347 and most productive movements of men are investigated. Tliese laws consti- tute a great code, wliicli for tlie first time in industry completely controls the acts of the management as well as those of the workmen. They substitute exact knowledge for prejudiced opinion and force in determining all the conditions of work and pay." Time and motion studies are made with the assistance of split-second watclies; which enable the time and motion study men to time all motions, and from the analysis of the records thus secured and the study of the motions to determine the time in which the work should be performed and the motions by which this is to be done. These studies are also made for the purpose of determining the most economical manner of doing the work. Many of these time studies are exceedingly minute, some of the workmen's instruction cards showing as small an allowance as one hundredth of a minute for the performance of a part of the work and make such fine distinctions as the allowance of two hundredths of a minute for laying down a wrench, while three hundredths are allowed for picking it up, as shown in the reproduction given from an instruction card for operation. Instruction card for operation. Time allowed in hundredths of a minute. Put piece on arbor 0. 15 Piclt up wrench . 03, Tighten expansion arbor . 15 Lay down wrench ^ . 02 Run carriage up and set pointer at 0: . 16 Put tool in post and set in center of pulley . 79 Put piece on stud and fasten . 24 Start machine .02 Set tool for turning and throw in feed . 18 Turn outside diameter 2-inch run 1. 64 Throw out feed . 01 Face inside and outside diameter of flange .82 Stop machine L . . 14 Much has been said about the scientific accuracy of time studies, for the efficiency engineers realized that unless the stamp of accuracy was placed upon time studies and the tasks for worlcers to perform which were set as a result the scientific character of their theory and its results when applied would be successfully challenged. At the beginning of the investigation It was apparent that scientific accuracy In the timing of work and the setting of a tasli was an impossibility owing to the large amount of judgment which was required on the time-study men's part. The number of time studies to be made on a job before the task was set were determined by the time-study man, with no other rule to guide him but his judgment. His judgment also determined how many of the workers should be studied in connection with a job, the type of workers to be selected — that is, whether slow, average, or speedy, whether they were working normally while he was timing them, and the allowances he would make for fatigue and the other human factors. When these elementary time studies were analyzed it was the time-study man's judgment which determined how many of the longest or shortest times would be thrown out and the groups of times to be selected from which to strike an average or whether the minimum times should be the ones chosen. In almost every establishment a different basis or rule for determining the times to be selected from which the task would be deter- mined was found to be in operation. One time-study man who was asked why he followed a certain rule in analyzing his time studies naively informed us that he clid not know how the rule was determined, but he " guessed that the rule had been constructed so as to get the results which its inventor wanted." As the Hoxie report contains a thorough examination and analysis of the time and motion study methods found in operation no effort will be made to go deeply into the question. Some of the conditions which were encountered, however, will be related. Workers were found who expressed no objection to having time studies made on them, while others were strongly opposed to having a man stand over them with a split-second watch In his hand. 348 METHOD OP DIRECTING WORK OF GOVERNMENT EMPLOYEES. In one plant, where time studies were being made for our benefit, it was found that there were wide variations as well as apparent errors in the figures which the time-study man had entered upon his elementary time sheet. Upon his attention being called to this he said : " I generally come much closer to the average figures, but I knew that you were watching me while I was making the study and it made me nervous." The same man had previously assured us that it did not make the workmen nervous when he was making time studies of their work. As was the case with many other features of " scientific management," it was found that the results of time and motion studies varied widely in dif- ferent establishments, and that other factors aside from the records secured by time and motion studies influenced the task setter in making the task easy or difficult of accomplishment. At one plant in which the tasks were set by one of the most widely known efficiency engineers it was found that he had set these so liberally in one of the departments that the workers were earning more than the firm was willing they should, with the result that some time after the engineer had finished the installation of his system in some of the other departments the firm refused to allow the system to continue, and returned to the former methods of regulating the day's work and day's pay. This resulted in a lowering of the earnings to their former level in the department referred to and a strike was narrowly averted. At another plant, where a most prominent efficiency engineer had in- troduced parts of the system and set the tasks, it was found that he had set them so high, had made them so difficult of achievement, that the workers could not accomplish them. It became necessary to revise all of these tasks and liberalize them in order to retain their employees. Another establishment afforded an insight into some of the motives which entered into the setting of the tasks, making them dtthcult or easy of accom- plishment. The plant was a large one, with many departments, covering in some cases work largely of a similar character. In the one which had been placed under " scientific management " the task and bonus system of payment prevailed, while in another which had not been time studied and standardized the old- fashioned piece-rate system prevailed. This plant had been frequently referred to by others as an example of the benefits of " scientific management " to the workers, for it was claimed that under the piecework system the workers worked harder and received less wages than in the department where " scien- tific management " had been installed. Our investigation proved this to be a fact, for unquestionably the workers in the " scientific-management " depart- ment were working with less evidence of feverish haste than in the piecework department, and their earnings were greater. A careful investigation, however, indicated that these surface indications were misleading. When the corporation determined to install " scientific man- agement " in this particular plant they were informed by the efficiency engineer that there was a strong prejudice against the system among the workers, which it would be necessary to overcome before it could be successfully installed in all of the departments. As a first step he increased the hourly rate 2 cents in this department, installing with it a task and bonus system, which when the taslc was aoconi- plished gave the workers about a 20 per cent addition to their hourly wage rate. The tasks were so set that practically every worljer could accomplish them without undue exertion, the result being that at the time we visited the plant they were working more easily and receiving higher earnings than the pieceworkers. We found, however, that the cost of production in this de- partment was higher than in the piecework departments, and that this was the principal reason why it had not been installed in them. This was an instance where the workers wanted "scientific nvirvagement," preferring it to day or piecework, and under these circumstances if was not surprising. There remains another condition in connection v^-ith this situation which must be referred to. Within a few miles the same corporation had anothor large plant, and here the manager, using such information as could be secured relative to the mechanisms of "scientific management," was installing the system. Here, however, none of the tasks were easy of accomplishment, and no advance in the hourly wage was being given. The workers were rebelling against the conditions being forced upon them, while the superintendent of the METHOD OF DIBECTING WORK OF GOVERNMENT EMPLOYEES. 349 department where the system had first been installed complained of what the manager in the other plant was doing, saying that it looked as though he was trying to show him up. Under such circumstances, and with one manager pitted against another, it is evident that something far stronger than the fair promises and assurances of " scientific management " must be at the workers' disposal to protect them from abuses, speeding up, and poor pay. In praetif'e it was frequently found that where more thlan one job was given to a worker the task set, or the standard of achievement, was much more dif- ficult of accomplishment in some cases than in others. If the tasks were set with scientific accuracy. It would be expected that the normally competent worker would achieve the task approximately 100 per cent of Ihe time, or, to use the technical language of " scientific management," " that this efficiency in accomplishing his work would be 100 per cent." If the recorded efficiency of individual workers on various jobs indicated a wide variation, then it is but natural to assume that the variations were due to the inaccuracies of the task time set for the several jobs. An Interesting and most valuable analysis of variations of output by the same workmen under " scientific management " has been made by Mr. Miner Chlpman, and we give the following figures from the study which he made of the conditions existing at the Watertown Arsenal after the system had been introduced. The analysis of the men's output or so-called efficiency covered a period of one month, which makes it well representative of the unevenness with which the tasks had been set. For the month of March, 1914, employee No, 2518 worked on 224 jobs. His average efficiency was 121.35 per cent, but his efficiency on these jobs varied from 21 to 200 per cent. , In September, 1913, employee No. 2681 worked on 91 jobs. His average efficiency was 96 per cent, but his efficiency on the several jobs varied from 39.3 to 149 per cent. Employee No. 2518 worked on 140 jobs during April, 1914. He was a most competent workman, as his average efficiency for the month was 121 per cent. His efficiency on the several jobs ranged from 45 to 172.9 per cent, these varia- tions indicating largely the too short or too long time which had been set on the jobs by the time-study and task-setting man. Commenting on these figures, Mr. Chlpman said in his report : " Mr. Taylor, in his ' Shop management,' emphasizes ' that this system rests upon an accurate and scientific study of unit times,' which is by far the most Important element In ' scientific management.' He also says that time studies made by this method determine with scientific accuracy ' the quickest time that can be made by a first-class man ' and to the effect that this ' quickest time ' or ' standard times ' is so set that It can not be bettered. "What can be thought of, the times set on these jobs, when this workman on the 224 jobs of one month showed a range of efficiency (efficiency being the ratio of time taken to time allowed ) from 21 to 200 per cent, with an average of 121 per cent, and the following month on 140 jobs a range of from 45 to 173 per cent, also with an average of 121 per cent? "This workman may be rated as consistently of high efficiency. Why. then, this extreme variation In efficiency unless the time allowed for each job was not set accurately and scientifically? Can we assume that the worker varied In efficiency to the extent shown by the chart? We do not believe so. The variation is one of time setting or inaccuracy of time study. " Of the 244 jobs In the first month the time on 13 jobs was correct, efficiency lOO per cent ; on the remaining 211 jobs the time varied 2,755 minutes, or 22.2 per cent from a total slandard time of 12,935 minutes. "A study of the various jobs indicates that the variations in efficiency are due in part to the time-study man and in part to changes in conditions affecting work." On two jobs in the foundry examined by the writer a diflerence of 2 hours and 30 minutes had been set, though at the outmost there could not have been more than 10 minutes' difference in the time to make the molds, as the patterns were almost Identical and were made in the same flask, the only apparent dif- ference being that a longer hub on one of the patterns required aboue 2 inches more sand in the drag. 350 METHOD OF DIRECTING WORK OP GOVEBNMEKT EMPLOYEES. An interesting case, tlirough whicli tlie worlier was forced to suffer because of tlie error made in setting tlie time for tlie task, occurred in one of tlie machine shops visited. A machinist was given eight crossheads to finish, 44 minutes being allowed for the finishing of each crosshead. As this machinist took considerably more time, he was punished for his failure to accomplish the task by being laic} off for 30 days. i. . , i ,* During this period a more careful investigation was made of the job, and It was afterwai-ds given to another machinist, who received a rate of 3 cents less per hour. The time allowed for the finishing of the task was increased 120 per cent, and although the machinist working on the job had a rate 3 cents less per hour than the other, it increased the cost of production 78 per cent. The machinist who was disciplined, however, was not allowed anything for the unjust punishment which had been meted out. It would be possible to go on almost indefinitely in submitting evidence to prove that the time set on jobs by time-study men and task setters in shops where " scientific management " has been applied has been anything but scien- tifically accurate. While in theory it should have been, what the workers are directly interested in is what occurs when application of a theory is turned over to employers and placed in practice. It is the practice and not the theory which most vitally affects the workers. Wliile in theory the time allowed for the performance of a task or job is scientifically accurate, if it has been set as the result of time and motion studies, it was evident to the efficiency engineers that mistakes would be made, and that these would cause dissatisfaction among the workers. To give them confidence that they would have no unfair advantage taken of them, " scientific management " laid down a principle upon which it has placed tlje greatest emphasis. This is that once a time or standard had been set for the performance of labor it would not be changed no matter how favorable it might be to labor. This principle is iterated and reiterated throughout the literature of " scientific management." As far as our investigations were able to discover, this rule generally obtains in practice, though managers were found who repudiated it, holding that when the task had been set too liberally the workers knew it, and that as all errors, particularly those which the workers are aware of, should be immediately acknowledged and corrected, it was unwise not to change the time on the job ; in fact, that this was necessary if the firm's intelligence was to receive the workers' respect. It should not be inferred, however, that once a too liberal time has been set on a job or task it remains thus forever. A slight change of the design, a sub- division of the operation, or some other minor change readily gives opportunity for new time and motion studies, through which the error can be corrected. Naturally, the question arises as to wliat follows when too short a time has been set. No comprehensive answer can be given, for neither trade unionism nor any other manner of collecting the workers' grievances exists in plants applying the system, with perhaps one exception. In practice, when workers complain that insufiicient time has been allowed on a piece of work they are shown the sheets upon which the time-study man has entered the split-second watch records and are told that here are figures which show what was done and that no one can go behind these, or it is demonstrated to them that the task can be done in the time set by the time- study man or by some selected workman. In one establishment a time of 5 hours and 24 minutes had been set for the performance of a task. As it required something over 38 liours to accomplish it, the responsibility for tlie error was left for the time-study men and the planning room to fight out, but the question of what would happen if the error had been less glaring and how often these errors were made was one which, if answered, would throw more light upon what occurs when the task set places too great a strain upon the worker without harassing him enough to cause open rebellion. APPRENTICESHIP. " Scientific management " makes no provision for apprenticeship. In one plant a definite apprenticesship system, whii:li ninierl to develop competent craftsmen, was in operation for a limited number of boys, but apparently this exception was due to one Individual in the firm who still retained the conviction METHOD OP DIRECTING WORK OP GOVERNMENT EMPLOYEES, 351 that thoroughly trained mechanics would still be required by the Industries at least for some years. What was called an apprenticeship was in operation in a few of the plants, but the training being given was not for tlie development of craftsmen, but rather to instruct a few bright young men for positions iu the directing staff. Both in tlieory and in general practice " scientific iwanngement "' abandons the method of apprenticeship for the purpose of craft and manual training and endeavors to substitute in its place specialization and standardization. Not only do many of the efficiency engineers hold that apprenticeship for the training of craftsmen Is not longer necessary, as their system provides for pro- duction without all-round craftsmen, but in more than one instance the thought was brought out that training apprentices was expensive and did not bring practical results for the outlay of time and wages; that where a thoroughly trained mechanic was necessary it was advisable to go into the open market and secure craftsmen who had been trained in other plants. An example of this viewpoint is supplied by the following statement, made to us by an expert In one of the plants : " We can not talie a man under apprenticeship and let him do different things for four years and then pay him $21 per week. We must put him on one job and keep him on one job. " There are some boys and girls in the composing rooms, and I would like to teach them to become printers, keyboarders, proof readers, make-up men, stone men, and teach them two or three phases of the hnsiness, but 1 have the threat in the back of my Itead that at the end of four years I must make them' earn $21 a week, and I can go at the en'l of the four years and get a much better workman for the money, so I must keep them on one job." SPECIALIZATION AND STANDARDIZATION OF LABOR. In referring to the specialization which occurs under " scientific manage- ment " and the forms of instructions for workers which exist, the Hoxie report says: " Once within the shop, ' scientific management,' according to the claims made by Mr. Taylor, solves completely the vexing problem of the adaptation and adequate training of the workers. It sets ' each man to the highest task for which his physical and intellectual capacity fits him,' ' employs in the shop a corps of competent specialists whose duty it is to instruct and train the workers and to assist them whenever difficulties arise in connection with the work,' * systematically transmits ' to them ' all the traditional craft knowledge and skill which Is being lost and destroyed under current industrial methods,' ' requires workmen to learn and to perform not one merely but several opera- tions or tasks,' and ' educates and trains them mechanically as they were never trained before.' In .short, it constitutes a 'practical system of vocational guidance and training,' making possible the ' mutual adaptation of the task and the worker,' and opening the way ' for all workmen to become first-class men.' " After describing the conditions whicli were found in practice, the Hoxie report asserts that " The theoretical transmission to the workers ' of all the traditional craft knowledge which is being lost and destroyed under current industrial methods ' amounts in practice to the transmission to the individual of the knowledge required for the particular narroAV job." In general the managers of shops where the system was In operation held that they preferred the one-job or one-machine man to the thoroughly trained mechanic. On more than one occasion I asked the managers of machine shops the following question: "If you needed a machinist to operate a lathe and two men applied for the position, both of an equally promising appearance, but one only claiming to be a lathe hand while the other claimed to be equally com- petent to operate a planer and a boring mill, which would be hired?" Tlie almost invariable answer was, " We would employ the man who could only operate a lathe, for he would be a specialist." This point of view was expressed by the manager of one large plant while explaining his attitude towards ap- prenticeship and specialization. " Where you manufacture," he said, " you must specialize. We decidedly do not have the facilities here for making first-class all-round mechanics. A specialist is of value to the company and we compensate him. There is so much more intensification In every field that we prefer a specialist to an all- round mechanic." 352 METHOD OF DIRECTING WORK 01' GOVERNMENT EMPLOYEES. Another manager of a large establishment said to us : " The worker under the present specialized system is as well off as under the old, but the old skilled workman is no longer required," and after a short pause be added: '• The trouble is that the workers to-day are not as ambitious as they should be under the conditions." What ambitions cotQd be gratified by. feeding the same shape of metal Into a machine for days, weeks, and months, or in screwing on nut 47 or 73 on an automobile, with no opportunity of rising in the scale as a craftsman, must be left to a MUnsterberg to discover. In practice " scientific management " seeks continually to specialize and sub- divide the work so that tlie worker performs but a minute part of the work formerly done by a craftsman and required to complete a product. In one of the foundries visited five men were employed on various parts of the same small mold which formerly had been made in its entirety by one molder. In a garment-manufacturing establishment the manager informed us that previously there had been 25 operations to complete a pair of trousers, but now there were 75; that under the old system there were about 50 separate operations in the making of a coat, but that under " scientific management " this had been increased to 150. Even in the pressing of the clothes the pressors no longer pressed the entire suit, but only some of the parts. Going through one large establishment we stopped before a girl who was taking threads previously cut to a certain lengtli, threading these into a needle, and then waxing the thread. The firm's expert informed us that previous to the installation of " scientific management " each girl had threaded her own needle, cutting off the threads in lengths to suit herself. The method of " scientific management," however, had shown this to be all wrong, for if a girl cut the thieads too short she had to thread her needle too often, which was a waste of time, while If she cut the thread too long she lost much time taking the long draws necessary until the thread became shorter. The girls sewing on buttons were therefore given different lengths of thread,, and a careful record was kept of the number of buttons each girl sewed on per day, and when the length of thread which enabled the girls to sew on the largest number of buttons per day was secured through analyzing the results, this length of thread was made the standard. Based on the theory that a girl trained to thread needles could do this more efficiently than anyone else, one girl spent much of her time threading needles with the standard length of thread, this being one subdivision of the trade of sewing on buttons. However, from a " scientific " standpoint this was but a clumsy and slipshod result of an analysis of the " sewing on of buttons " trade, as we soon discov- ered, for in another garment-making establishment they had studied this trade with a more searching spirit. If the length of thread with which the needle was threaded determined the number of buttons a girl could" sew on in a day, then the length of her arms would also be a factor, for the girl with long arms would take a longer draw after putting the needle through the cloth and the button than the girl with short arms. Once this " scientific " fact was discovered, the experts made elaborate studies of the problem, girls with short, medium, or long arms working witli standard lengths of thread being watched and the results of their day's output analyzed. As a result of these studies it was possible for the experts to discover the proper length of arm to enable a girl to sew on the largest number of buttons, and the employing department was Instructed to supply the button-sewing department with girls whose arms were of the desired length. But even this was not scientifically thoroughgoing, for it was found tliat the length of the fingers un- doubtedly had an influence, and studies were made to determine what the most efficient length of fingers was, so that the girls in this department who were being specialized as button sewers would all have fingers and arms of the same length. So in time the firm had a group of girls sewing on buttons with stand- ardized lengths of thread with their standard fingers and arms. Here was the perfection of " scientific management ! " But human nature or human qualities and characteristics are prone to upset the rigid rules of mechanical motions when theise are applied to them. It was not long before the experts, who had studied for many weary days with stop watches and pondered deeply over huge masses of the time studies they had accumulated, discovered that though Ihey had stiuulardlzed the length of thread and the length of fingers and arms which were to sew on buttons with the thread, tliere was still a wide difference between the girls' output. METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. 353 What the efficiency experts had failed to standardize, what as a matter of fact they could not standardize, were the physical and mental qualities of the workers, their vitality, their ambitions, their nervous coordination, their ability to work without physical, nervous and mental deterioration under the monotonous character of their work. In the end, in the latter plant, standard lengths of thread, or of fingers, or of arms, were discarded, and each girl was permitted to cut the length of the thread to suit herself, with the result that the unstandardized girls were apparently enjoying better health, were less rushed, and were doing better for themselves and their employers than their standardized sisters. There may have been a modicum of scientific research, coupled with other objects, which led to the original time and motion studies resulting in the standardizing of the length of thread, fingers, and arms in the trade of sewing on buttons, but the welfare of the girls, the desire to teach them to become competent garment workers, was certainly not the prime motive. A result of this specializing and subdividing of the work is the employment of workers of less craft knowledge' and narrower manual skill, who for lower earnings replace the skilled workmen. One instance came under our observa- tion where skilled v^'orkmea who had been employed for years by the firm and whose earnings were from $30 per week upwards were replaced by girls and women whose wages were less than half of that amount. These female workers each completed but a small part of the finished whole. The extensive specialization which occurs could be illustrated by a barber shop, where one worker would attend to the hot water, another work up the lather, a third apply it to the face, a fourth do the shaving, a fifth the strop- ping of the razor, while still others would respectively wash, dry, and perfume the shavee's face. It is true that each of these workers might be termed a highly trained specialist, but such a narrow degree of craft or industrial knowl- edge would be of little practical value to him, to the community, or to the Industries. The detailed observations of the workers' motions while at work, known as motion study, are carried on for two principal purposes. The highly skilled worlters are closely observed so that their manual motions and method of laying out and handling theif work may be studied until a record of the most efficient method of doing each minute part of the job can be secured and analyzed. The best way to pick up a tool, to use If, to handle the material and pre- pare It for the finished product, are determined by the time and motion study man and recorded. This enables him later on to take the work formerly re- quiring skilled workmen and subdivide It, giving the doing of one part of the job to one worker and another to someone else taken from the ranks of the lessee paid and taught to do the simple parts of the Job to which they were assigned. Through this careful study of every motion and method used by the skilled worker and its recording upon index cards, the employer in time acquires as personal property thejsraftman's skill and knowledge, and then doles this out to the lesser skilled ffnd lower paid workers, who are then employed to sup- plant the skilled craftsmen formerly required. This practice raises a most serious problem relative to which the Hoxie re- port says : " There can be little doubt that ' Scientific management ' tends In practice to weaken the power of the Individual worker as against the employer, setting aside all questions of personal attitude and the particular opportunities and methods for voicing complaints and enforcing demands. As we have seen. It gathers up and transfers to the management the traditional craft knowledge and transmits this again to the workers only piecemeal as it is needed In the performance of the particular job or task. It tends In practice to confine each worker to a particular task or small cycle of tasks. It thus narrows his outlook and skill and the experience and training which are necessary to do the work. He is therefore easier of displacement. Moreover, the changing of methods and conditions of work and the setting of tasks by time-study with its assumption always of scientific accuracy put the individual worker at a disadvantage in any attempt to question the justice of the demands made upon him, and the assumed payment of wages In proportion to efficiency with the opportunities of exceptional reward held out If he will but make the task, tend to put upon him responsibility for wage results of which he complains. 36162—16 23 354 METHOD OF DIRECTING WORK OF GOVERNMENT EMPLOYEES. There are no simple, deflriite, recognised and permanent standards of worli and earnings to.whicli he can appeal. The onus of proof is upon him anil the standards of judgment are set up by the employer, covered by the mantle of scieutiflc accuracy. The unskilled worker, especially, under ' Scientific man- agement,' loses what little chance of success as an individual he may elsewhere have, in any contest with the employer, and ' Scientific management,' from the standpoint of competitive power, tends to relegate workers to the condition or the unskilled." In addition to the gathering up of the craftsman's skill and transferring It to the employer's indexed records, motion study in practice Is applied in In- structing the worker so that no unnecessary motions will be made in connec- tion with the work. The instructor with the motion study records at his dis- posal, plus the untrained worker,, is expected to take the craftsman's place. If the form of specia.lizatlon which was found in operation in the great ma- jority of plants visited could be applied to our industries as a whole, craft skill and knowledge among the workmen would disappear. The craft knowl- edge would become the employer's property in the same degree that his ma- chinery is something personally owned, craft skill would also be the employer's possession, that particular part required for the performance of the work being given to the worker by instructors. The workers would have neither knowl- edge nor skill except that small and limited part which would be required to accomplish the simple portion of the work to which they were assigned. The manager of one, large establishment informed us that owing to the de- gree of specialization he had carried out it was possible for him to take un- trained workers and instruct them so that in 10 or 15 days they could do the most of the work in the plant. Others infromed us that In a month or two, under their system, they could make full/ competent operatives for the worli in their establishments. In a word, the specialization and standardization of labor under " Scientific management " as we found It, provides no apprentice^ ship system for the training of craftsmen and assumes that the thoroughly trained mechanic is no longer required except in rare instances. It aims to replace the trained craftsmen with worliers whose knowledge is limited to a few simple operations, and whose labor is directed by instructors. If generally applied the craftsmen would pass out of existence, and the workers would become dependent for their existence upon the scanty and In- significant industrial knowledge and experience afforded them by their lim- ited opportunities, regulated by those who, in addition to ownership of ma- chinery, had also acquired possession of craft knowledge and the skilled work- ers' methods. OVER-SPEEDING. One of the strongly defended claims of "Scientific management" is that It prevents the workers from being over-speeded. Mr. F. W. Taylor held that: " ' Scientific management ' seeks to eliminate over-stimulation, over-speeding, and nervous and physical exhaustion of the Workers : " By substituting exact knowledge, based upon a careful study of men and machines, for guess work In the setting of the task, and the determination of the hours and other conditions of work. " By eliminating thus the need for the employment of pacemakers. "By transferring from the workers to the management responsibility for contriving the best methods of work. " By removing from each worker responsibility for the work of others and for the instruction of beginners and helpers. "By maintaining the best conditions for performing the work through fur- nishing the best tools and inaterials at the proper time and place. " By training the workers in the most economical and the easiest method of performing operations. " By standardizing equipment and performance. " By instituting rational rest periods and modes of recreation during work- ing hours. " fey surrounding the workers with the safest and most sanitary shop environ- ments." As' found in practice, "scientific inanagement" presented a wide range of conditions from which to draw conclusions as to the claim that under this sys- tem overspeeding is prevented. In no Instance was it found that the philosophy of the shorter workday had Infiuenced any efficiency engineer or employer to reduce the hours of labor METHOD OF DIKECTING WOEK OP GOVERNMENT EMPLOYEES. 355 while one of the leaders of " scientific management " inforined us that the workers could be employed 10 or 12 hour^ per day without any physical injury resulting. In one or two plants systematic efforts had been made to prevent overspeed- Ing, workers were advised not to endeavor to accomplish more than the task, and in one Instance as a deterent workers were penalized through a sharp re- duction in the sum allowed for the completion of the job. In general, however, the workers were encouraged to beat the task, through both the employer's policy and the foreman's efforts to secure their bonus, the winning of which de- i)ended upon the workers achieving the tasks. Reference to what appears under the head of "time and motion studies" will Indicate the unscientific, irregular character of much of the task setting, arid the various influences which animate the task setter while engaged in his work. The reward received for reducing the cost of production, the employers' desire for speedy results, the temptation to make a better record than some other efficiency engineer or task setter, these and other motives operate to set the tasks so high that overexertion is necessary to accomplish them in many Instances. Nowhere was it found that fatigue studies had been made, which would be of value. In fact, no scientific study has yet been made of the subject of fatigue, or of the workers' long-time efficiency, and as no comprehensi%'e studies of human fatigue have been made by scientists, there is no data upbn the sub- ject which would warrant anyone's speaking upon it witli authority. But evert if there were, the important questions would be the manner in which the knowledge of the subject would be applied to the workers and the degree to which it would safeguard them from overstrain. Upon this subject the Hoxie report says: "A much more definite issue is brought up by Mr. Taylor's claim that ' scien- tific management ' guards the workers against overspeeding and exhaustion through careful studies of fatigue and the setting of the task on tiie basis of a large number of performances, by men of different capacities and with due and scientific allowance for the human factor and legitimate delays. It has been pointed out already in the discussion of time study that tasks are set in all sorts of ways, with reference to the men chosen and the number of performances timed. There is no general rule. And it was also demonstrated that no scien- tific method had been developed for the making of human allowances, and that these are sometimes very liberal, but sometimes also unduly curtailed. It must be admitted on the other hand that ' scientific management ' can and often does go far through the study of machinery and the careful observation of the on- {;oing process of production toward the establishment of proper allowance for legitimate delays, not connected directly with the human factor. When we come, however, to the matter of fatigue studies, and their connection with speeding and exhausion, Mr. Taylor's claim seems to break down completely. No actual fatigue studies were found taking place in the shops, and the time- study men employed, who should be charged with such studies, seemed, in gen- oral, to be quite indifferent or quite ignorant in regard to this whole matter. Fatigue studies apparently are not made when the tasks are set, and, if after- wards complaint is made, the classical method of dealing with the subject is to ' demonstrate ' to the worker that the task can be done in the time set. Efforts to discover from ' scientific management ' experts proper methods for studying fatigue brought out only vague replies. Were it not for certain examples cited in ' scientific management ' texts, there would seem to be no ground for credit- ing it with any scientific aspirations in this connection. This does hot mean that no attention to fatigue is given in 'scientific management' shops. Oases were found where the health and energy of the workers were carefully observed and attempts were made to adapt the work to their condition, but the methods employed were the rough and ready ones of common-sense observations." While it is true that some efficiency engineers and employers have taken the element of fatigue into consideration with the object of preventing the worker's overexertion. It is equally as true that others aim to develop a system which will spur the workers to their limit. The speed competition attitude on the workers' part is developed through inany clever methods. In one plant the workers were divided into small groups, each group having a high post near it upon which two large signs were hung, one showing the number of pieces the group must finish during the day to complete their task and the bther the