The Theory and Policy of Labour Protection

by A. Schäffle; etc. statutes Germany. Laws

CHAPTER X. TRANSACTIONS OF THE BERLIN LABOUR CONFERENCE, DEALING WITH MATTERS BEYOND THE RANGE OF LABOUR PROTECTION; DALE’S DEPOSITIONS ON COURTS OF ARBITRATION, AND THE SLIDING SCALE OF WAGES IN MINING.

The demand for a legal minimum wage, for wage tariffs, and the sliding scale of wages, form no part of Labour Protection. The State cannot, as we have seen, regulate wages directly, but only indirectly, by favouring an adjustment of wages that shall be fair to each side. But even in measures of that kind it does not interfere for the purpose of protecting the persons of the wage earners in their relations of dependence on the employer. Politico-social proposals for indirectly influencing the movement of wages, do not for this very reason, belong to Labour Protection, in the sense which I have assigned to the term in this book. Therefore, I shall content myself, on the one hand, with clearing up a misunderstanding concerning the minimum wage and the wage tariff; and on the other hand, with supplementing my former contribution to the subject (Jahrg., 1889, Die Zeitschrift für die gesammte Staatswissenschaft) from the reports of the Berlin Conference, having special reference to the regulation of wage in the English mining industries.

These proposals, dealing with minimum wage and the wage tariff, which I shall now introduce into my treatise on Labour Protection, do not aim at enforcing a minimum rate of wage from above, regardless of the individual value of the labour, they merely aim at providing as far as possible a stable adjustment and classification of efforts and rewards between the whole body of employers and the whole body of workers in any branch of industry or industrial district, i.e. at substituting general for individual control, for the protection not of the worker alone, but also of the employer, i.e. against exploiting competitors. In Germany the printers have led the way; the number of their followers in other industries is increasing. But this is a matter that must be settled by the two classes, not by the State.

Questions of wage policy, however, even when unconnected with protective policy, are often drawn into discussions on protective policy; and even the Berlin Conference, which was officially designated[14] “an international conference on the regulation of labour in industrial establishments, and in mining industries,” frequently overstepped the limits of questions of purely protective policy. I feel myself fully justified, therefore, in touching upon a few of the further questions dealt with by the Conference.

In an earlier treatise, written before the proclamation of the Imperial Decree of February 4th, 1890, I pointed out the need for the special cultivation of Labour Protection in mining industry, particularly in coal mining, and I expressed an opinion as to the advisability of establishing government mines as a kind of politico-social model to the rest; while, on the other hand, I declared against the necessity for the nationalisation of coal mines.

Pamphlets of an opposing tendency, which circulated freely in the wake of the great coal strike of 1889, have, it is true, brought to light more and more reliable evidence; but hitherto I have found in them nothing to shake my confidence in the correctness of my fundamental contention: as far as I am concerned, I await without anxiety the issue of the latest Coal Trust.

As I pointed out in the same treatise, the special danger of the strike agitation, attacking as it does the very centres of activity and channels of healthy movement in the social body, has unfortunately been only too fully exemplified. The coal strike, and the railway and dock strikes, have become samples, and are triumphantly quoted as typical instances of the success of the method.

In the same treatise I raised the question whether the branches of industry under consideration should be constituted a department of the public service, involving special obligations and special safeguards against breach of contract, but also ensuring special security of work and a good standard of pay. This question has also risen to a high level of importance since that time; it does not, however, belong to the sphere of Labour Protection, and in this treatise I must therefore leave it on one side.

But I consider myself bound to supplement the information given as to the means of avoiding strikes in the mining industry by bringing forward the communications made by the best informed English expert, who sat in the Berlin Conference (session of March 4). The reports read as follows: “Mr. Dale reminded the Conference that about twenty-five years ago numerous and protracted strikes took place in the north of England (in mining). In consequence of this, the employers met together to discuss means of regulating the wage question. At first they refused to treat with the workmen in corpore, but they finally decided on the advice of a few of their number more far-seeing than the rest, to recognise the union of miners belonging to one and the same mining district. This principle once admitted formed the groundwork of the prevailing system of the day for the settlement of all disputes. This method has obtained for twenty years. At first the representatives of the employers and workmen were only summoned to negotiate on special questions. The principle of settlement by arbitration was admitted in all questions, and was applied in the following manner: each party nominates an equal number of arbitrators, usually two, and these elect an umpire; this last office is willingly accepted by persons of the highest standing. Since the questions laid before the board of arbitration mostly concern the relation of wages to the market price of coal, this relation has to be first ascertained from examination of the employers’ books by a legally qualified auditor, before a decision can be given. The most important experimental method, which has so far been adopted for regulating the relations between the rate of wage and the market price, has been the sliding scale. The sliding scale aims at the establishment of a numerical ratio between the rate of wage and the price of coal. At first this was sometimes determined by the following method: five consecutive years are taken, in the course of which considerable fluctuations have taken place in the market prices and the price of coal (the latter brought about by strikes, agreements, and arbitration). These five years are divided into twenty quarters; the average price of coal and the average rate of wage for each quarter is ascertained, and by this means the numerical ratio of the two amounts to each other is determined. The average of these numerical ratios is taken to express the normal relation which must exist between the rate of wage and and the market price of coal. Upon the scale thus determined the average market price for all coal produced in the district for the last preceding quarter is reckoned. The required numerical normal proportion between prices and wages is now computed on this basis, and the rate of wage for the current quarter thus determined. This calculation takes place for every ensuing quarter. These calculations are made by two qualified auditors, who are appointed by the labourers’ union and the employers’ union. The books of all the works are submitted to these experts, who are bound to the strictest secrecy as to the information thus obtained. They confine themselves to the task of attesting: (1) that during the latest preceding quarter, the average price of coal in the district is such and such; (2) that such and such a rate of wage results therefrom. In this way the workmen obtain, without the necessity of negotiation, of strikes, or arbitration, the same wages which they could not otherwise have obtained except by repeated efforts. The numerical ratio between wages and market prices is generally fixed for two years. After that time each party may give a half year’s notice; but during six years, the first sliding scale introduced has only been subjected to very slight alterations. Notice will shortly be given by the employers in Northumberland and the miners in Durham. Mr. Dale believes that this double notice does not aim at the abolition of the system, but only at revision of the existing scale. In the districts where for the moment the sliding scale has been abolished, an attempt is being made to take the nearest conjectural price of the current quarter as the basis, instead of the price of the previous quarter. In this way the workmen would receive official information as to the market prices, which would be a great advantage, for strikes are most frequently caused by the ignorance of the workmen as to the real position of the coal trade. As to local questions which do not affect the whole district, they are settled by so-called ‘joint committees,’ or mixed commissions formed by an equal number of workmen and employers; either the President of the county court, or some other person of high position, is chosen as chairman. These commissions meet generally once a fortnight; their decisions operate from the date of the complaint. Mr. Dale asserts that the heads of the labour unions are, for the most part, intelligent men, and when this is the case, the relations between workmen and employers are easily arranged; in Durham, e.g., the miners union has four secretaries, who devote their whole time to the affairs of the association. In this district more than 500 disputes yearly are settled by the joint committee.”

At the request of the President, Mr. Dale gave some information as to the strike of the past year; it did not affect the northern district where good relations existed, although notice had previously been given on the sliding scale. He further pointed out that former strikes had often been caused by the fault of the foremen, who treated the workmen with undue harshness. “The introduction of joint committees, on which the workmen are equally represented, has had the effect of establishing better relations between the foremen and the miners. Mr. Dale considers this the best system for the avoidance of crises. The decisions pronounced by the board of arbitration, and by the joint committees, are generally accepted; thus the principle of decision by arbitration takes the place of that of decision by strikes.”