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The Railroad Employees' National Pension Association has been earnestly and closely identified with all legislative work in connection with retirement pensions. We are ever so grateful for the splendid and able cooperation of the Members of Congress, all of whom have made it possible to secure its enactment. We are glad, indeed, that our labor executives have becomes interested in the act. Since the passage of the Railroad Retirement Act, August 29, 1935, more than 20 months ago, our association has been without a live issue to maintain the interest of the employees. They have been waiting in fear and anxiety for a Supreme Court action on the constitutionality of the law; consequently, only a few thousand faithful employees are now maintaining their membership, whereas previously we had many thousands of members. It is my best judgment, however, that the Railroad Employees' National Pension Association is representative of the pension sentiment of 90 percent of the employees.
In my appearance before you today I am genuinely sorry that we cannot give our endorsement to the amending bill now before you, which I presume, embodies the agreement lately negotiated by our Railway Labor Executives' Association and the representatives of the Association of American Railroads. Consistent with the past attitude of our labor chiefs toward this association, we were not provided with a copy of the agreement which is said to be embraced within this amending bill. Neither were we, as members of our respective craft organizations, furnished with copies of the agr ment. I have never seen such a copy. Our only understanding of its details was gleaned from an article published in our national weekly, Labor, which was an account of a glamorous and glorious victory won by our labor chiefs in conference with representatives of the Association of American Railroads on the subject of the Railroad Retirement Act. The recited purported details is the extent of our information.
Taking into consideration the amending bill, H. R. 6956, the great victory claimed by our labor chiefs, for securing the cooperation of our employers, is not apparent. At the expense of the employees
1. They have given away the right to receive the annuity on the first day of the month, for that month, during the lifetime (sec. 3 (c) present law).
2. They have given away the right of retirement to employees under 60 years of age and with 30 years of service (sec. 2 (a) 2).
3. They have given away the term “mental or physical disability" with which an employee with 30 years of service is eligible for a retirement annuity without a cut-back of one-fifteenth, and have imposed in its stead the term "totally and permanently disabled for regular employment for hire” (sec. 2 (a) 2).
4. They have given away the right to a full annuity for an employee who might retire at age 65, and if he had previously received an annuity for “total and permanent disability", by requiring of him to accept a reduced annuity sufficient to compensate for the annuities already paid him during his disability, thereby making him pay for his own disability (sec. 2 (a) 3).
5. They have given away the right for an annuity to an employee who may lose his job and who may be under 65 years of age and have
less than 30 years of service, and who may be otherwise employed by an employer not defined in this act, by requiring such person to retire from his employment, notwithstanding his annuity may be greatly inadequate to afford him a decent standard of living.
6. They have given away the right for an annuity to an employee who may lose his job and who may be less than 60 years of age, and who has 30 years of service, and who may be otherwise employed by an employer not defined in this act by requiring such person to retire from his then employment notwithstanding his annuity at age 60, subject to the one-fifteenth cut-back for each year under 65 would be greatly reduced and inadequate to afford him a decent standard of living
The amendment suggested by Mr. Harrison to section 2 (a) is putting into the bill the nefarious and much protested provision in the original agreement between Railway Labor Executives' Association and the Association of American Railroads which reads as follows:
An annuity shall not be paid in respect of any calendar month during which an annuitant engaged in regular gainful employment.
Points 5 and 6 which I have just read are predicated on Mr. Harrison's amendment.
7. They have given away the compulsory feature of the present law (sec. 2) which penalizes an employee after age 65, by imposing a one-fifteenth cut-back on his annuity for each year he remains in the service.
8. They have given away the right for an annuity for the month during which an annuitant may die (sec. 3 (g)).
9. They have given away the right of an employee, when attaining 65 years of age, or another employee who has 30 years of service and who may be broken in mind or body, to provide to his wife a joint survivor annuity unless he will have so elected, irrevocably, before January 1, 1938, or at least 5 years before his annuity shali have begun to accrue (sec. 4).
10. They have given away, by omitting in the amending bill, section 5 of the present law, which provides that in the event of the death of a person who was receiving an annuity, or was entitled to receive an annuity, the surviving spouse or next of kin shall receive one-half of the annuity for 1 year.
11. They have imposed an unfair, unjust, and inequitable discrimination against all retired employees of such carriers as have no gratuity pension association or board, by not including such retired employees with the retired employees of carriers which have gratuity pension associations (sec. 6).
That was their trading stock.
We did not need the help and cooperation of our employers to do these hurtful, damaging, and injurious things to our fellow workers. I shall now enumerate things in the bill that will be helpful and curative of defects of the law as has probably been noted in its administration:
1. They have broadened the coverage of the act to include the brotherhoods as employers (sec. 1 (a)).
2. They have broadened the term "employee" to cover "employee representative" and their employees (sec. 1 (b)).
3. They have broadened "employment relation" to justly cover cases where an employment relation could not be established because of inability on account of sickness to respond to a call to get into active service (sec. 1 (d)).
4. They have broadened the term “compensation” to include wages for time lost (sec. 1 (h)).
5. They have provided an alternative to determine a fair average monthly wage of an employee where the test period 192+31 is insufficient to constitute a just and equitable basis (sec. 3 (c)).
6. They have provided a return of 4 percent of aggregate earnings for subsequent service, to spouse or estate, in the event of death (sec. 5).
7. They have provided a way to secure the gratuity pensioners in their pension by putting them on the rolls of the Railroad Retirement Act. We are happy, indeed, that this has been agreeably accomplished. Theoretically, the employees will pay one-half of the cost of these pensions. If so, what may we say to the retired employees of the Milwaukee road, the Chicago Great Western, the Minneapolis & St. Louis, the Pere Marquette, the Chicago & Alton, the Southern Railway, and many other railroads? What may we say to these employees to excuse so rank a discrimination! I have said that theoretically, the employees in the service will pay one-half of the cost of the pensions paid to the lucky gratuitants, while we have no word of authority to say about the rules governing carrier gratuity pensions associations, which determine who shall or who shall not be a beneficiary. A so rank a discrimination smells to heaven.
There is the record of accomplishment. Nos. 2, 3, 4, and 5 are curative of provisions of the present law which needs the Congress would readily prescribe, upon its attention being called to it.
No. 1 pertains to the 21 brotherhoods as organizations.
Nos. 6 and 7, we must assume, are the benefits which are to accrue to the employees for which it is intended to trade the 11 points, as I have enumerated above.
Points 1 and 6, which are representative of the great victory won by our labor chiefs over the Association of American Railroads, or all seven points, could easily be legislated into the law if presented to the Congress. The Congress would surely not insist on imposing the injury of the 11 points on the employees to enact this legislation. The four curative points are needed legislation for a fair administration of the act. Points 1 and 6 would not involve great difficulties. Point 7, dealing with the gratuity pensions, is worthy legislation and we are for it with every fair means. It will meet the favor of the employees almost to a man and should be legislated. We cannot see any necessity of emasculating the present law to gain these minor points, 1 and 6. We cannot conceive a good reason for the Association of American Railroads to opposite it.
Mr. Chairman and gentlemen of the committee, I protest to high heaven against this tragic barter. Before I go further, I wish to express my good will and appreciation of any assistance that has been given or may be given to our cause by the Association of American Railroads, but I must remind you, in the interest of 1,250,000 employees affected by the Railroad Retirement Act, that the legis
lation, sponsored by the Railway Labor Executives' Association and the Association of American Railroads, will net the latter association handsome savings. A return to them of the 10 months' tax for 1936 is nearly $50,000,000; the saving to them on the 234-percent tax over and above what it would cost them under the 312-percent tax is nearly $13,000,000; the saving to them on their gratuity pensions by putting them on the Railroad Retirement Act rolls is nearly $20,000,000 annually, a total of all savings amounting to more than $80,000,000. I am not surprised that the carriers are for the bill.
It is impossible for us to reconcile this bill with a sincerity of purpose. It is collusive rather than cooperative. It is a bill greatly advantageous to the carriers and is cruel, vicious, and hurtful to the employees. In its major particulars it is the carriers' bill.
The 11 points that I have enumerated, which are so damaging to the employees, will be explained to you by our counsel, Mr. Frank E. McAllister, a practicing attorney of Chicago and St. Paul, Minn. Incidentally Mr. McAllister is a member of the Order of Railroad Telegraphers, an associate organization of the Railway Labor Executives' Association.
I beg your indulgence for a concluding remark. As president of the Railroad Employees' National Pension Association, representing it and its membership, standing before this honorable committee, having a lifetime experience as a railroad employee, I would be thoroughly ashamed and humiliated to meet my fellow employees if I were to give our endorsement to H. R. 6956 as it is drafted today.
Mr. COLE. Mr. Chairman
Mr. COLE. I notice your criticism of section 5. Will you explain as briefly as you can the difference between the bill before us and the existing law, as to the way it affects widows and orphans; that is, at the death of a railroad employee, say, 70 years of age with a widow of the same age, who has traveled all through life with him; what difference is there between the existing law in her case, what she would be entitled to, and this?
Mr. RoYSTER. Mr. Cole, the existing law provides that an annuitant or an employee who is eligible for an annuity-just to be 65 years of age does not make you eligible. The Railroad Retirement Board has held that a person to be eligible for an annuity must have made an application and stated a date for his annuity to begin and has to sever his relations for active employment with his carrier. All of that must be done before he becomes eligible.
Well, such a person as he, if after attaining that eligibility, he should die, then in that event whatever pension he may have qualified for, or annuity, he may have qualified for, one-half of that will be paid to that widow for the next 12 months, for 1 year.
Mr. COLE. Is that under the existing law?
Mr. ROYSTER. That is under the existing law. That has been omitted in the amending bill.
Mr. COLE. Then explain also, in omitting it from the present bill, what happens to the widow under this bill?
Mr. ROYSTER. Nothing is done for her. Nothing is done for him until such a time as subsequent service will amount to something. At
the present time no employee in the United States has more than 4 months of subsequent service. This is the fifth month. This will be 5 months. That is all of the subsequent service that there is available to the railroad employees and the amending bill provides that in such a case the widow or the estate will get 4 percent of his aggregate earnings for his subsequent service.
The subsequent service dates from December 31, 1936, forward.
Mr. COLE. Well, in reading section 5 of the present law it is very easy for me to understand what it does. Section 5 of this bill is somewhat complicated. Your view is that the widow gets less under the bill before us than she does under the present law?
Mr. ROYSTER. Well, you say that the present law is complicated. Mr. COLE. No; I say that the present law I think is very simple. Mr. ROYSTER. It is, indeed.
Mr. COLE. But we have all of this language here in the bill before us. I do not know whether it is true or not, but it looks as if she gets less than under the present law. I want to know some reason for it.
Mr. ROYSTER. Of course, section 5 of the amending bill and section 5 of the present law do not deal with the same subject matter entirely, because of the fact that in the present law they deal with those who are qualified for annuities, and I am frank to say to you, Mr. Cole, that under the present law, if an employee who was not qualified for a retirement pension and if he were to die, there is no provision made for that widow, and with this difference, with this section 5, that is in here which we are considering, it is a good feature, except that we consider it a good feature, but it is not valuable at the present time. It will be increasingly so as time goes on, but not for 15, 20, or 25 years will it become of great value.
Mr. HALLECK. Mr. ChairmanThe CHAIRMAN. Mr. Halleck, -Mr. HALLECK. Are you opposed to the passage of this bill as it is now drawn? Mr. ROYSTER. As it is now drawn, I am; yes, sir.
Mr. HALLECK. As I understand you, you are the president of, or manager of an association or organization which was formed for the purpose of procuring railroad pension legislation.
Mr. RoYSTER. We are the original initiators of the pension movement; yes, sir.
Mr. HALLECK. And, of course, if the objective of the association is reached, insofar as the enactment of some railroad pension law is concerned, I take it that the continuation of your association will be a rather difficult matter?
Mr. ROYSTER. We do not have any wish to continue this association, if that is what you are driving at; we do not have any wish to continue this association further than what its needs may be.
Mr. HALLECK. Did I understand you to say that you did not represent any of the standard railroad brotherhoods?
Mr. ROYSTER. I do not represent them. I am a member of one of those standard organizations. I am a member of the Brotherhood of Locomotive Engineers and have been for 33 years. Previous to that time I was a member of the Brotherhood of Locomotive Firemen. I am straight.