STATE ARBITRATION AND THE LIVING WAGE. WITH AN ACCOUNT OF THE NEW ZEALAND AND VICTORIAN LAWS AND THEIR RESULTS. SECOND EDITION: REVISED. PUBLISHED AND SOLD BY THE FABIAN SOCIETY. PRICE ONE PENNY. LONDON: THE FABIAN SOCIETY, 3 CLEMENT'S INN, STRAND, W.C. State Arbitration and the Living Wage. THE disastrous effects of a great labor dispute which has paralyzed an industry for months are obvious to all, and the consequences of smaller disturbances, though less apparent, are in the aggregate scarcely less important. In the five years, 1898-1902, there have been, on an annual average, 632 strikes and lock-outs, involving 211,775 persons a year, and costing an annual loss of 5,716,026 working days. For thirty years everyone has been "ingeminating peace," and we propose, in the first place, to examine the machinery that exists to-day for preventing industrial war; and secondly, to consider in what way lasting peace can be secured. Disputes may arise either out of the interpretation of an existing contract, or out of the framing of new terms of labor. To decide the former class is a judicial act, to determine the latter is a legislative function. Interpretation cases are on the Continent settled by special courts, but in England they are in no way distinguished from other cases, and, from the comparative rarity with which they come under the public eye, are scarcely included within the popular meaning of the term industrial dispute. In this Tract we shall deal mainly with the second class. Method of Collective Bargaining. For the proper consideration of disputes arising out of the framing of new labor contracts it is important to bear in mind that they are only the exceptional failures which occur in a complex system of negotiation between employers and employed. Where the men are disorganized the terms of labor are fixed at the will of the masters, but the trade unions practise a method of collective bargaining which ensures peace throughout a great part of the industrial world. Beginning with the negotiations of shop committees, or single branches, with individual employers, the process has developed into regular conferences between the organized masters on the one side and the union of all the workmen in the trade on the other, and the drawing up of collective agreements embodying common rules for the whole industry, fixing both wages and the other conditions of labor. Similarly with disputes affecting individuals only-from the intervention of the trade union secretary on behalf of a victimized workman we proceed to the regular examination of all complaints in the textile industry by the paid secretaries of the employers' and workmens' organizations, and the reference of the few cases in which they cannot agree to joint committees, first of the local, and finally of the central associations. In the higher grades of industry we have thus a private legislative system and a private judicial system established by mutual agreement, and enforcing decisions by appeal to the law-abiding spirit of the people. The Board of Trade Bluebook on Standard Piecework Lists,* will give some idea of the work of the unions. In 1902 only 14 per cent. of the workmen whose wages were altered in the course of the year were engaged in disputes on this account. Even when conferences and negotiations fail, and a strike or lock-out ensues, the unions are pre-eminent in effecting peace, and in 18971901 settled by direct negotiation 732 per cent. of the total strikes. Temporary joint committees naturally develop into trade boards of a more permanent character, representative of employers and employed in equal proportions. In 1902 there were 67 such boards actually at work, which dealt with 1,462 cases, and settled 678. The Durham Joint Committee for the coal trade owes its success to the fact that while general wage-movements are determined on the basis of the old sliding scale, now abolished, it settles what alterations shall be made in the county average wage to meet the peculiarities of working in particular collieries, and arranges colliery as apart from county disputes. Provision is made for the reference to arbitration of cases which the committee cannot settle. The local boards in the boot trade, on the other hand, have "full power to settle all questions submitted to them concerning wages, hours of labor, and the conditions of employment of all classes of workpeople represented thereon within their districts." Their exercise of this jurisdiction is, however, governed by the clauses in the Agreement of 1895, referring to minimum wage, output, machinery, etc. Trade Boards, in fact, only seem to be successful where they work under carefully defined preliminary agreements. The full power of collective bargaining through trade unions and trade boards is only attained in the few well-organized trades. For some time after 1890, District Boards of Conciliation were warmly advocated as a means of bringing the disputants together and inducing them to settle their differences amicably, that is by collective bargaining. Though they were welcomed by the weaker trades, their period of favor was brief, and in 1901 there were only nine such boards registered under the Conciliation Act, of which the London board is the chief. Finally, the reference of disputes to private persons is the oldest form of private intervention. With the disappearance of sliding scales, and the growing activity of the Board of Trade, it has become less prominent than formerly, but it is frequently provided for in collective agreements. Some notable modern instances, like the Coal War in 1893 and the Boot Trade Dispute of 1895, were really official Governmental interventions, not to arbitrate but to further the negotiations between the parties. Government Mediation. The report of the Royal Commission on Labor in 1894 recognized the failure of private attempts at mediation, and recommended (1) that Town and County Councils should be enabled to create special tribunals for defined districts or trades, more or less after the pattern *Report on Wages and Hours of Labor, Part II. C.-7567 I. of 1894. ment should promote by advice and assistance the formation of trade and district boards of conciliation and arbitration; (3) that the Board of Trade should have power to enquire into and report on any trade dispute; and (4) that the Board of Trade should have power to appoint an arbitrator, when requested by both parties. In 1896 the Conciliation (Trade Disputes) Act was passed, empowering the Board of Trade, where a dispute had arisen or was apprehended, (a) to enquire into the causes of the dispute; (b) to induce the parties to meet together with a view to an amicable settlement; (c) to appoint a person to act as conciliator when requested by either party; (d) to appoint an arbitrator on the application of both parties. Private boards of conciliation and arbitration might be registered under the Act, and where no Board existed the Board of Trade might endeavor to get one formed. This measure is thoroughly permissive, for neither can one party to a dispute compel the other to submit the difference to arbitration, nor is either bound by the award. In both these respects it is inferior to the Durham Joint Committee and the Boot Trade Boards, and it has been thoroughly discredited by its powerlessness to overcome the obstinacy of Lord Penrhyn, and by the tardiness and inefficacy of Mr. Ritchie's intervention in the engineering dispute. To the end of June, 1901, 113 cases had been dealt with under the Act, nine on the initiative of the Board; 32 disputes were settled by conciliation, 38 by arbitration, and 10 out of court; in 33 cases a settlement was not effected, or the application was refused by the Board of Trade. Compulsion in New Zealand. New Zealand is the classical land of compulsory arbitration, the only land where it has had a fair trial, and the only land where industrial peace prevails. Since the Hon. W. P. Reeves, then Minister for Labor, carried in 1894 his Industrial Conciliation and Arbitration Act, "all matters or things affecting or relating to work done or to be done, or the privileges, rights, or duties of employers or workmen in any industry" are withdrawn from the domain of private warfare and placed under the regulation of law. In the first place that Act defined the bodies with which it had to deal by providing for the registration of any number of persons, not less than five employers or seven workmen, as industrial unions, which thereby become corporate bodies with power to sue and be sued. They alone could take proceedings under the Act, for the law took no cognizance of disputes between individual workmen and their masters, but yet unregistered employers or men were not exempt from the control of the law. These industrial unions might enter into industrial agreements with each other-or industrial unions of workmen with individual employers-dealing with any industrial matter or for the prevention or settlement of industrial disputes. These agreements-which resembled the "collective agreements" with which we are familiar— * Third Report of the Board of Trade of Proceedings under the Conciliation (Trade Disputes) Act, 1896. C.-296. must run for not more than three years, and were enforceable by law if they provided penalties for breach. The colony was divided into six districts, in each of which a Board of Conciliation has been established consisting of four persons, two chosen by the industrial unions of employers and two by the industrial unions of workmen, and of a chairman chosen by the Board from outside at its first meeting. In case the unions refused to take part in an election the Governor might nominate members to complete the Board, and he could also appoint a chairman if the Board could not agree on one. Special Boards might be appointed to meet special cases, to be elected in the same way. The Board was to hold office for three years. Industrial disputes could be referred to a Board for settlement either pursuant to an industrial agreement, or on the application of any party to a dispute, ie., an individual employer, or several employers, or an industrial union of employers or workmen. The parties might appear by their representatives or, if all sides agreed, by counsel or solicitors. After investigation the Board was to attempt to arrange an amicable settlement, failing which it "shall decide the question according to the merits and substantial justice of the case," and issue a report accordingly. Any party to the case might thereupon require it to be submitted to the Court of Arbitration. This Court acts for the whole colony, and consists of a president, who must be a Judge of the Supreme Court, and two members recommended by the industrial unions of employers and workmen respectively. The Court holds office for three years, and, like the Boards, has power to inspect factories, administer oaths, and compel the production of documents or the attendance of witnesses. It may award costs and dismiss frivolous cases. All questions must be decided "in such manner as they find to stand with equity and good conscience." Every award must specify the parties upon whom, and the period, not exceeding two years, for which it is to be binding, and it must be given within one month after the Court has begun to sit for the hearing of any reference. On the application of any of the parties the Court may order the award to be filed in the Supreme Court office, and it is then enforceable in the same way as a judgment of the Supreme Court, the maximum fine being 500 for any union or person, and £10 for any individual on account of his membership in a union. No strike or lock-out must be declared after a case has been referred to a Board or to a Court, and proceedings are not to be nullified by mere want of formality. The amending and consolidating Act of 1900 strengthened the Boards by giving their recommendations automatically the force of an industrial agreement unless an appeal was taken within a month. The term of agreements and awards was extended to three years, and even after the lapse of that period they were to continue in force until superseded by a new agreement or award. In giving their decisions the Boards or the Court may deal with industries other than the one actually affected if they are branches of the same trade or "so connected that industrial matters affecting the one may affect the other." The Court may also make an award covering the whole |