Patrick, Herbert J., Universal Carloading & Distributing Co., Inc., Statement of-Continued Page Nolan, Frank W., Contracting Stevedores of the Port of New York, Parmelee, J. H., director, Bureau of Railway Economics, Association of American Railroads, Washington, D. C.. 222 261 Pelley, J. J., president, Association of American Railroads, Wash- Pennington, Maitland, secretary-treasurer, National Federation of American Shipping, Washington, D. C.. Ream, Forest V., 3274 P Street NW, Washington, D. C.. Rice, Roland, general counsel, American Trucking Association, Richardson, Eldon, American Warehousemen's Association_ 203 19, 73, 308, 373 Shelley, Leander I., general counsel, the Port of New York Authority 75, 123 Souby, J. M., general solicitor, Association of American Railroads, Stevenson, H. D., secretary, National Association of Stevedores, Taylor, Mount, executive secretary, National Association of Ice Tobin, Fred A., legislative representative, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America__ Brown, R. W., president, Reading Railroad Co., Philadelphia, Pa... Cohen, Joseph, president, Tide Water Terminal & Stevedoring Co., Devlin, Charles A., president, The Philadelphia Maritime Exchange, 272 Gale, Robert S., secretary, Foreign Commerce Club of Boston, 236 Handschin, Robert, director of research, Farmers Union Grain 271 Jewell, E. O., New Orleans, La.. 332 Kline, Robert E., Jr., of the firm of Kirlin, Campbell, Hickox & McGuirk, E. J., president, New Orleans Steamship Association, New 378 270 McIntosh, W. B., chairman, committee on social security, National 273 Olson, Mrs. A. E., president, Railroad Employees' National Pension 269 Scully, John J., Independent Union of Car Shop Workers, East Street, Thaddeus, Jr., manager, Charleston Stevedoring Co., Charles- 274 237 Thompson,Nathan W., attorney at law, Portland, Maine Tobias, Ashley C., Jr., president, Organized Business, Inc., Columbia, 234, 235 272 RAILROAD RETIREMENT MONDAY, JULY 23, 1945 UNITED STATES SENATE, SUBCOMMITTEE OF THE COMMITTEE ON INTERSTATE COMMERCE, The subcommittee met at 10 a. m., pursuant to call, in room 357, Senate Office Building, Senator Edwin C. Johnson, chairman of the subcommittee, presiding. Present: Senators Johnson of Colorado, Hoey, Briggs, Shipstead, and Hawkes. Senator JOHNSON of Colorado. The subcommittee will come to order. We have met today to hear testimony with respect to S. 293. On this bill, or, rather, on a bill very similar to it, the House committee held extensive hearings, extending over a period of 31 days. Those hearings were carried on from January until May of this year. The most of the proponents and opponents of the proposed legislation had full opportunity to testify before the House committee in those hearings. We have copies of the House committee hearings for each member of this subcommittee, each member of the Interstate Commerce Committee of the Senate, and a copy for each Member of the Senate itself. This subcommitee decided, in view of the recent testimony I have referred to, that it would not be necessary for this subcommittee to hold extensive hearings. We have agreed, therefore, to limit the debate to approximately 10 hours, 5 hours for proponents, and 5 hours for opponents. We have asked witnesses, and are asking them now, to consolidate their testimony; to confine it as much as possible to new material, and to a consolidation of the testimony they gave before the House committee. We have several witnesses who describe themselves as either for the measure with amendments or as more or less neutral so far as being proponents or opponents is concerned. We will try to work their testimony in as best we can under the heading of proponents or opponents. I am sorry that all members of the subcommittee are not present, but we are holding this hearing at a very inopportune time, in the closing days of Congress, when there are all kinds of loose things to gather together, and when Members of the Senate have all sorts of work to do, brought about by reason of the closing days of the session. However, we have set the time for this hearing and will go ahead with it, and hope the evidence will be a guide to the subcommittee and 1 to the full committee in determining the position the Senate should take on S. 293. At this point I should like placed in the record a copy of S. 293. (The bill under consideration, S. 293, is as follows:) [S. 293, 79th Cong., 1st sess. By Mr. Wheeler and Mr. Wagner] A BILL To amend the Railroad Retirement Acts, the Railroad Unemployment Insurance Act, and subchapter B of chapter 9 of the Internal Revenue Code; and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, DIVISION I SECTION 1. Section 1 (a) of the Railroad Retirement Act of 1937 and section 1 (a) of the Railroad Unemployment Insurance Act are amended to read as follows: "(a) The term 'employer', except as otherwise provided in this subsection, shall mean "(1) Any carrier: A 'carrier' is any express company, sleeping-car company, or carrier by railroad, subject to part I of the Interstate Commerce Act; "(2) Any person, other than a carrier regulated under part I of the Interstate Commerce Act, which, pursuant to arrangements with a carrier or otherwise, performs, for hire, with respect to passengers or property transported, being transported, or to be transported by a carrier, any service included within the term 'transportation' as defined in section 1 (3) of the Interstate Commerce Act, whether or not such service is offered under railroad tariffs; "(3) Any freight forwarder: A 'freight forwarder' is any person, other than a carrier, which holds itself out to the general public to transport, or provide transportation of property for hire, and which in the ordinary and usual course of its undertaking assembles and consolidates, or provides for assembling and consolidating, shipments of such property, and performs, or provides for the performing of, break-bulk and distributing operations with respect to such consolidated shipments, and assumes responsibility for the transportation of such property from point of receipt to point of destination, and regularly and substantially utilizes, for the transportation of such shipments, the services of one or more carriers; "(4) Any person engaged in rendering, pursuant to any arrangement for one or more carriers, any service which (i) is of such a nature as to be susceptible of indefinitely continuous performance and (ii) constitutes a part of or is necessary or incidental to the operation or maintenance of way, equipment or structures devoted to transportation use, or constitutes a clerical, sales, accounting, protective, or communications service necessary or incidental to the conduct of transportation carried on by a carrier, or is rendered with respect to passengers or property transported by railroad, at point of departure or shipment or at destination or between such points; "(5) Any person which, through any form of property interest, is directly or indirectly subject to control by or to common control with a carrier and which (i) is engaged in acquiring or holding title to managing, maintaining, or operating any property devoted substantially to use in the transportation conducted by such carriers; or (ii) is engaged in performing services necessary or incidental to the conduct of the transportation carried on by such carrier, or services in the manufacture of equipment or equipment parts or in the processing of materials for use in the operation, servicing, or maintenance of way, structures or equipment devoted to use in transportation, or services in connection with the storage, elevation, or handling of property transported, being transported, or to be transported if such storage, elevation, or handling services are provided with respect to property accorded privileges of storage in transit, or for the promotion or facilitation of transportation conducted by such carrier; or (iii) is engaged in transportation by motor vehicle; "(6) Any railroad association, traffic association, tariff bureau, demurrage bureau, weighing and inspection bureau, collection agency, and other association, bureau, agency, or organization controlled and maintained wholly or principally by two or more employers and engaged in the performance of services in connection with or incidental to railroad transportation; "(7) Any railway labor organization, national in scope, which will have been or may be organized in accordance with the Railway Labor Act, and such organization's State and National legislative committees, general committees, insurance departments, and local lodges and divisions, established pursuant to the constitution and bylaws of such organization; "(8) Any organization maintained or controlled by one or more employers, and principally engaged in furnishing medical, hospital, educational, recreational, or other welfare services to employees, or in providing for the payment of life, sick, accident, or other benefits to such employees or the dependents or survivors of such emplyees; and "(9) Any receiver, trustee, or other individual or body, judicial or otherwise, when in the possession of the property, or operating all or any part of the business of an employer as defined herein. "(10) Exclusions: Except with respect to persons covered by clause (iii) of paragraph (5), the term 'employer' shall not include any person (i) by reason of operations in the conduct of which such person holds itself out directly to the public as a common carrier by water, air, or motor or animal-drawn vehicle, or as a contract carrier by any of such means, other than contract carrier service regularly offered to railroad passengers, shippers, or consignees pursuant to arrangements with an employer such as defined herein; or (ii) by reason of the performance of any operation which is insubstantial or is so irregular or infrequent as to afford no substantial basis for an inference that such operation will be repeated; or (iii) by reason of its being engaged in the mining of coal, the supplying of coal to an employer such as herein defined where delivery is not beyond the mine tipple, and in the operation of equipment or facilities therefor, or in any of such activities, or in logging or the milling of lumber to standard commercial sizes, or in furnishing supplies to a carrier; or (iv) by reason of the operation of a street, interurban, or suburban electric railway, unless such railway is operating as a part of a general steam-railroad system of transportation, or is a part of the general steam-railroad system of transportation now or hereafter operated by any other motive power. The Interstate Commerce Commission is hereby authorized and directed, upon request of the Board, or upon complaint of any party interested, to determine after hearing whether any line operated by electric power falls within the terms of this clause. The term 'employer' shall not include any individual by reason of the performance of any service by such individual personally. "(11) Segregation: Any person who is an employer as defined in this subsection shall be an employer with respect to all activities carried on by it, except that (i) any person who is an employer by reason of paragraph (9) shall be an employer only in the capacity described in that paragraph; (ii) if the Board finds that a person is principally engaged in activities other than employer activities and that its employer activities are conducted as an operation or operations separate and distinct from the operations in which it is principally engaged, such person shall be an employer only with respect to such employer operation or operations; and (iii) if the Board finds that a person who is an employer solely by reason of paragraph (2) or (4) of this subsection, is principally engaged in activities other than employer activities but does not, pursuant to clause (ii) find that the employer activities of such person are conducted as an operation or operations separate and distinct from the operations in which it is principally engaged, such person shall be an employer only with respect to all work performed in its employ by individuals who regularly and substantially perform work on property structures or equipment devoted to transportation use. If to a substantial extent the individuals working in employer activities regularly work also in the operations in which a person is principally engaged, such employer activities shall not be deemed to be conducted as an operation or operations separate and distinct from the operations in which such person is principally engaged. For the purposes of this subsection, a person shall be deemed to be principally engaged in activities other than employer activities if the man-hours devoted to such other activities are more than onehalf of the total man-hours devoted to all activities carried on by such person, except that if the Board finds that a determination on such basis is impracticable or inappropriate the Board shall make the determination on the basis of such factors as in its judgment are relevant and appropriate. The term 'employer activities' as used in this subsection shall mean all such activities as are conducted by a person as a carrier, or as are described in paragraph (2), (3), (4), (5), (6), or (8). When a final determination will have been made as to whether a person is principally engaged in employer activities, the matter shall not be redetermined except upon the basis of operations conducted for a period of not less than three years following the last operations considered in making the previous determination, unless the Board finds that substantial activities will have been abandoned or substantial new activities will have been undertaken. Upon any such redetermination the conclusion shall be governed by the previous determination, unless the Board finds that on the basis of the factors on which such previous determination will have been based, the activities in which the person previously was principally engaged constitute less than 40 per centum of such person's activities." SEC. 2. Section 1 (c) of the Railroad Retirement Act of 1937 and section 1 (e) of the Railroad Unemployment Insurance Act are each amended as follows: After the word "if" in the first sentence insert “(i)” and for the phrase "which services he renders for compensation" substitute the following: "or he is rendering professional or technical services and is integrated into the staff of the employer, or he is rendering, on the property used in the employer's operations, other personal services the rendition of which is integrated into the employer's operations, or he is personally performing for an employer any service by reason of which, except for the last sentence of paragraph (1) of subsection (a), he would be an employer, and (ii) he renders such service for compensation", and for the purpose of continuing the amendment of the Railroad Retirement Act of 1937, only, add after the word "compensation" the following: ", or a method of computing the monthly compensation for such service is provided in section 3 (c)". Said subsections are further amended by inserting at the end of the first proviso the following: ", and if the application of such mileage formula, or such other formula as the Board may prescribe, would result in the compensation of the individual being less than 10 per centum of his remuneration for such service no part of such remuneration shall be regarded as compensation". SEC. 3. Section 1 (h) of the Railroad Retirement Act of 1937 is amended by substituting for the words "earned by" the words "paid to", and section 1 (i) of the Railroad Unemployment Insurance Act is amended by substituting for the word "payable" the word "paid"; by striking out the proviso in said section 1 (i) of the Railroad Unemployment Insurance Act and replacing the colon with a period; and by inserting at the end of said section 1 (h) of the Railroad Retirement Act of 1937 and at the end of said section 1 (i) of the Railroad Unemployment Insurance Act, the following: "A payment made by an employer to an individual through the employer's pay roll shall be presumed, in the absence of evidence to the contrary, to be compensation for service rendered by such individual as an employee of the employer in the period with respect to which the payment is made. An employee shall be deemed to be paid, for time lost' he amount he is paid by an employer with respect to an identifiable period of absence from the active service of the employer, including absence on account of personal injury, and the amount he is paid by the employer for loss of earnings resulting from his displacement to a less remunerative position or occupation. If a payment is made by an employer with respect to a personal injury and includes pay for time lost, the total payment shall be deemed to be paid for time lost unless, at the time of payment, a part of such payment is specifically apportioned to factors other than time lost, in which event only such part of the payment as is not so apportioned shall be deemed to be paid for time lost. Compensation earned in any calendar month before 1946 shall be deemed paid in such month regardless of whether or when payment will have been in fact made, and compensation earned in any canlendar year after 1945 but paid after the end of such calender year shall be deemed to be compensation paid in the calendar year in which it will have been earned if it is so reported by the employer before February 1 of the next succeeding calendar year or, if the employee establishes, subject to the provisions of section 8, the period during which such compensation will have been earned."; and in said section 1 (h), immediately after the word "earned" at the end of this insertion, insert the following additional language: "In determining the monthly compensation, the average monthly remuneration, and quarters of coverage of any employee, there shall be attributable as compensation paid to him in each calendar month in which he is in military service creditable under section 4 the amount of $160 in addition to the compensation, if any, paid to him with respect to such month." SEC. 4. (a) Sections from 1500 to 1530, inclusive, of the Internal Revenue Code are hereby amended by substituting “Board” for “Commissioner" and for "Bureau of Internal Revenue", "title" for "subchapter", and by deleting "with the approval of the Secretary" wherever said language appears. |