Question

How did World War II and the National War Labor Board greatly expand the use of arbitration?

Answer 1

To arbitrate labor disputes during World War II, the National War Labor Board (NWLB) was established by President Franklin D. Roosevelt on 12 January 1942 under Executive Order No. 9017. Composed of four labor leaders (from both the American Federation of Labor and the Congress of Industrial Organizations), four corporate executives, and four public representatives, it inherited personnel and policies from the National Defense Mediation Board (19 March 1941–12 January 1942) and gained strength from a pledge made in December 1941 by employee and employer representatives to avoid strikes and lockouts during the war. On 3 October 1942 the board's jurisdiction was extended by Executive Order No. 9250 to cover all wage rate adjustments. On 25 June 1943 its authority was strengthened by congressional passage of the War Labor Disputes Act.

As a result of increased caseloads from wage stabilization policy, the NWLB in December 1942 decentralized decision-making authority to ten regional war labor boards and to special commissions on individual industries, including aircraft, meat packing, and shipbuilding. Before its official termination on 31 December 1945, this quasi-judicial network, supported by 2,613 full-time staff, received 20,692 cases and disposed of 17,650. The central board settled 16 percent, affecting 29 percent of the 12.2 million workers involved.

More than 80 percent of the disputes involved wages. Rising living costs were a central concern. In responding to them the board applied the so-called Little Steel formula. Announced in July 1942, this policy limited general wage increases for groups of employees to not more than 15 percent of their hourly earnings in January 1941. The board also sanctioned wage increases in order to improve low standards of living, correct interplant and intraplant inequities, and ensure women war workers equal pay for equal work.

Only 17 percent of cases involved nonwage issues. Of these, union security generated the most debate. Labor leaders wanted closed shops, with union membership a condition of employment; employers wanted open shops, with freedom to hire at will. The board struck a compromise with the maintenance-of-membership clause. Under this policy, current and new employees were not required to join a union, but those who were or became union members had to remain members and pay dues, often through an automatic checkoff, during the life of a contract. A fifteen-day escape period was eventually provided so workers could quit unions without forfeiting jobs.

The maintenance-of-membership clause offended employers but strengthened CIO unions in mass-production industries. NWLB rulings also reinforced peacetime patterns of collective bargaining and augmented various fringe benefits, including sick leaves, holidays, and vacations. On the other hand, board efforts to fight inflation by capping wages alienated many workers. In 1943, for example, the United Mine Workers defied NWLB rulings and struck four times; subsequent work stoppages, especially in the auto industry, reached record numbers in 1944 and 1945. Subsequently, the NWLB staff of arbitrators, labor lawyers, and academics would draw on their wartime experiences to define the theory and practice of employer-employee relations in postwar decades.