Railway Labor Act

United States 1926

Synopsis

The Railway Labor Act (RLA) of 1926 was the most important piece of labor legislation "and the most significant attempt by the federal government to foster and regulate collective bargaining" prior to the New Deal. The RLA was the result of many years of effort to find a labor relations policy for U.S. railroads that would minimize labor unrest and avoid potentially crippling blockages of the nation's main arteries of transportation and commerce. The law provided for the creation of a mediation apparatus and empowered the president of the United States to seek a cooling-off period for parties to a railroad labor dispute. The act encouraged collective bargaining and forbade employers from interfering in workers' selection of their representatives. Subsequent judicial interpretations prevented employers from forcing workers to bargain through company-dominated unions, an important legal breakthrough that pres-aged elements of New Deal labor policy. In later years the RLA was revised and extended to cover the U.S. air transport system as well. While the freedom to strike was circumscribed by the RLA's provisions, unions gained security under its regulatory regime, and national rail strikes of the sort that periodically erupted during the half century prior to the RLA's enactment did not recur after 1926.

Timeline

• 1911: In China, revolutionary forces led by Sun Yat-sen bring an end to more than 2,100 years of imperial rule.
• 1917: On both the Western Front and in the Middle East, the tide of the war begins to turn against the Central Powers. The arrival of U.S. troops, led by General Pershing, in France in June greatly boosts morale and reinforces exhausted Allied forces. Meanwhile, Great Britain scores two major victories against the Ottoman Empire as T. E. Lawrence leads an Arab revolt in Baghdad in March, and troops under Field Marshal Edmund Allenby take Jerusalem in December.
• 1922: Inspired by the Bolsheviks' example of imposing revolution by means of a coup, Benito Mussolini leads his blackshirts in an October "March on Rome," and forms a new fascist government.
• 1924: V. I. Lenin dies, and thus begins a struggle for succession from which Josef Stalin will emerge five years later as the undisputed leader of the Communist Party, and of the Soviet Union.
• 1927: Stalin arranges to have Trotsky expelled from the Communist Party.
• 1927: Charles A. Lindbergh makes the first successful solo nonstop flight across the Atlantic and becomes an international hero.
• 1927: American inventor Philo T. Farnsworth demonstrates a working model of the television, and Belgian astronomer Georges Lemaî tre proposes the Big Bang Theory.
• 1927: The Jazz Singer, starring Al Jolson, is the first major motion picture with sound. Within a few years, silent movies will become a thing of the past.
• 1927: Babe Ruth hits 60 home runs, establishing a record that will stand until 1961.
• 1930: Naval disarmament treaty signed by the United States, Great Britain, France, Italy, and Japan.
• 1932: When Ukrainians refuse to surrender their grain to his commissars, Stalin seals off supplies to the region, creating a manmade famine that will produce a greater death toll than the entirety of World War I.
• 1937: Japan attacks China, and annexes most of that nation's coastal areas.

Event and Its Context

American Railway Labor Policy before 1926

Four factors conspired to make railroads a uniquely fruitful laboratory for American labor law in the era before the New Deal. Railroads occupied a unique place in the American economy in the pre-depression era. Most of the nation's market commerce depended upon railroads. Assurance of a maximum degree of labor stability on rail lines was therefore deemed important by law makers. Second, the reach of most railroads across state lines made them subject to federal regulation in a way that many other businesses of their era were not. Even when the U.S. Supreme Court read the commerce clause of the Constitution most narrowly, "as in exempting manufacturing from federal regulation as it did through the 1895 United States v. E.C. Knight decision," the courts always recognized the federal government's power to regulate railways. Third, railroad workers were among the first employees of interstate corporations to organize unions. Locomotive engineers formed their union in 1863. Conductors followed in 1868, firemen in 1876, and trainmen in 1883. The railroad brotherhoods were among the strongest unions in the United States in the late nineteenth and early twentieth centuries. Finally, the intense competition that characterized the industry, as well as the degree to which its fortunes were hostage to fluctuations in the health of the larger economy, meant that railroad workers often found their work threatened by instability or erosion of work standards. Railroad workers fought hard to defend themselves against such threats. For example, in 1877 a massive strike that eventually spread to a dozen states erupted when employees of the Baltimore and Ohio railroad protested a wage cut imposed upon them in the midst of a depressed economy. Federal troops were mobilized in Pittsburgh, Pennsylvania, and other cities in order to quell the strike.

Such conditions set the stage for federal regulation of railway labor relations. The first effort to provide such regulation came in 1888 with the passage of the Arbitration Act. This act empowered the president to appoint investigatory boards in cases of work stoppages and encouraged voluntary arbitration between the parties to a labor dispute, yet it failed to forestall labor-management conflict on the railways. Nothing illustrated this failure more clearly than the massive Pullman Boycott of 1894, in which members of the American Railway Union (ARU) refused to handle trains that pulled Pullman sleeping cars until the Pullman Company dealt fairly with its employees. As the boycott shut down rail traffic across wide swaths of the nation, President Grover Cleveland established an investigatory board. Voluntary arbitration did not settle the strike, however; federal intervention did. Troops were again mobilized to facilitate strike-breaking, and Attorney General Richard Olney won an injunction against the ARU, which resulted in the arrest and imprisonment of the union's leader, Eugene V. Debs.

In 1898 Congress replaced the moribund Arbitration Act with new legislation, the Erdman Act, a significant improvement over the 1888 law. Erdman strengthened the voluntary arbitration provisions of the Arbitration Act, outlined a clear mediation and conciliation process, and declared discrimination against workers on the basis of union membership illegal. However, the relief anticipated under the Erdman Act was short-lived. In 1908 the Supreme Court declared the Erdman Act's antidiscrimination provision unconstitutional in the case of Adair v. United States.

The next foray into the regulation of railway labor relations came in 1913 with the passage of the Newlands Act. This particular piece of President Woodrow Wilson's New Freedom legislation established a permanent, three-person board of mediation while retaining the voluntary arbitration procedures that had characterized previous legislative efforts in this area. It was not the Supreme Court but rather the railway brotherhoods themselves that overrode this act. In 1916, on the eve of U.S. entrance into World War I, the brotherhoods threatened a national strike unless their demands for an eight-hour workday were met. President Wilson quickly signed the Adamson Act into law, granting the workers' demands.

During World War I, the government was drawn still deeper into railway labor relations. In order to deal with extreme burdens that the war emergency placed on the nation's railways, President Wilson placed private railroad corporations under federal control by creating the Railway Labor Administration, headed by his son-in-law, Secretary of the Treasury William Gibbs McAdoo. From his new office, McAdoo promptly issued General Order No. 8, which forbade discrimination against railway union members. At the same time, McAdoo promoted collective bargaining and created arbitration boards that rendered judgements on labor disputes. Although strikes were never formally outlawed, this mandatory grievance procedure served to reduce wartime work stoppages on the rails. Their rights to organize now recognized by the federal government, railway workers flocked to unions as never before, and union membership soared along the rails. So encouraged were railway workers by the improvement in their wartime conditions that a powerful movement demanding that government control of the railroads be made permanent arose by the war's end. This movement eventually coalesced around an idea for nationalizing the nation's railroads called the Plumb Plan. However, the wave of political reaction that followed the war doomed the Plumb Plan. Rather than nationalizing the railroads, Congress returned them to private control and crafted new labor regulations through the Esch-Cummins Transportation Act of 1920. The act created a Railway Labor Board (RLB) made up of three railway representatives, three employee representatives, and three public representatives. The board was authorized to investigate disputes and publish decisions, the enforcement of which would rely on the force of public opinion.

Origins and Structure of the 1926 Railway Labor Act

In 1922 the Transportation Act was put to the test by a massive strike that exposed its flaws, ultimately forcing the revision of railway labor law in 1926. The 1922 strike was triggered when employers sought to exploit their strong postwar position by displacing established unions with company unions and engaging in other tactics to weaken the unionized railway crafts. The RLB provided no relief to workers. Indeed, it even ruled in favor of a wage reduction during the recession of 1921. Unions of railway shop craft workers fought back against deteriorating working conditions with a huge national strike in 1922. The largest railway strike in U.S. history, it was broken in large part by the intervention of the federal government. The administration of Warren G. Harding, through Attorney General Harry Daugherty, sought and received a sweeping injunction that prohibited virtually any action by workers in furtherance of their work stoppage.

In the aftermath of the bitter 1922 strike, neither carriers nor railway labor unions were satisfied with the RLB. The railway unions were the first to try to achieve an alternative. During 1922 those unions helped form the Conference for Progressive Political Action, endorsing candidates committed to labor reform in the off-year elections of 1922. In 1923 the shop craft unions joined with the operating unions in a committee that sought the abolition of the RLB and the drafting of alternative railway labor legislation. This committee worked with Representative Alben Barkley (D-KY) and Senator Robert Howell (R-NE) on legislation that was introduced in 1923. The premise of the Howell-Barkley bill recognized unions as workers' representatives in collective bargaining. It failed to pass, in part due to White House opposition, but the effort caused great concern to Calvin Coolidge, who succeeded to the presidency upon the death of Warren G. Harding in 1923. Coolidge was determined to avoid a repeat of the split between the Republican old guard and Progressives that had elected Wilson in 1912. Consequently, Coolidge called upon railway carriers and unions to work out a legislative compromise that would bring labor stability to the nation's rails. In 1925 negotiations between the unions and the carriers, facilitated by Secretary of Commerce Herbert Hoover, produced a compromise. That compromise was embodied in the bills proposed by two Republican legislators, Senator James Eli Watson of Indiana and Representative James S. Parker of New York, which resulted in the Watson-Parker Railway Labor Act (RLA). President Coolidge signed the act into law on 20 May 1926.

The 1926 act represented the culmination of a process of nearly a half-century of experimentation with federal railway labor legislation. The 1926 act included many features embodied in previous legislation; the difference was its emphasis on collective bargaining as a means of settling labor disputes. The 1926 legislation continued to rely on voluntary settlement procedures, and it lacked criminal penalties for noncompliance, but it did include stronger mandatory arbitration provisions that could be invoked in some situations.

The act made the following provisions: first, it empowered the president to appoint a nonpartisan board of mediation that had the authority to invite the parties in a labor dispute to negotiate a solution to their differences. If this process failed, the board was empowered to request both parties to submit their dispute to arbitration. If both parties agreed to arbitration, then the awards issued by the arbitration process were legally binding. Should one or both parties refuse arbitration, the board of mediation could request the president to appoint an emergency board of investigation. If the president did so, the board was required to submit a report on the dispute to the president within 30 days. During that initial 30-day interval, and for another 30 days afterward, the parties in the dispute were forbidden to change the status quo. However, parties were not required to adhere to the findings of the board of investigation. And after the expiration of 60 days following the president's appointment of the emergency board, both parties were free to exercise their right to enforce a strike or lockout. If the president chose not to appoint an emergency board of investigation, parties could still be required to refrain from strike or lockout actions for 30 days. Yet at the end of that period, they were also free to act in their perceived best interests. The "cooling-off" periods stipulated in the 1926 act were obviously meant to discourage parties from taking actions that could lead to large-scale shutdowns of portions of the nation's commercial arteries.

The 1926 act was less desirable for labor than the Barkley-Howell bill had been in two ways. First, it did not explicitly recognize unions as the workers' representatives; workers could choose the representation they desired. This in effect allowed workers to choose company unions to represent them. Second, the cooling-off periods prescribed by the 1926 act were more likely to disadvantage unions than employers. Indeed, unions traditionally have opposed legislation that enforces cooling-off periods, because such laws can be used to deny workers the power to strike when strike action might achieve the greatest leverage.

Despite these problems, however, labor supported the enactment of the 1926 law. First, the RLB system was so unsatisfactory that, in the minds of most union leaders, the new legislation was preferable to the status quo. Second, unions gained significant concessions that counterbalanced whatever problems they perceived in the act's elaborate mediation mechanism. The most significant concession came in the third part of Section 2 of the act, which was the first significant piece of federal legislation that directly limited employer use of company unions as vehicles through which to weaken unions. This portion of the act allowed each side in the negotiation of a dispute to select its own representatives free of "interference, influence, or coercion" by the other side. Unions read the provision as forbidding employers from forcing company unions upon their employees as a condition of collective bargaining. The U.S. Supreme Court agreed. In the 1930 case of Texas and New Orleans Railroad Company v. Brotherhood of Railway and Steamship Clerks (281 U.S. 548), the court upheld an injunction issued against a railway company when a union complained that it was being forcibly supplanted by a company-sponsored union. The decision stated clearly that "As the carriers subjected to the Act have no constitutional right to interfere with the freedom of employees to make . . . selections, they cannot complain of the statute on constitutional grounds." The effect of the act and its judicial interpretation was to promote collective bargaining in which workers were represented by independent unions, a precedent of huge magnitude.

The RLA did not forbid strikes, yet it clearly lessened their severity, as only one national rail strike followed in the years after its passage. That strike came when engineers and trainmen walked off the job in 1946 only to return to work when President Harry S Truman threatened to conscript them. The lack of national railroad strikes did not mean that workers or unions were entirely satisfied with the RLA. By the end of World War II, for example, the Brotherhood of Railroad Trainmen wascomplaining that it sometimes took as long as six to nine years to resolve grievances under the law. In one case, the union alleged that a pay claim filed against the Central New England Railway in July 1932 was not settled until March 1945. On balance, however, the act worked to the benefit of railway unions, and those unions resisted efforts to scrap the act.

Evolution of the Railway Labor Act

The RLA was amended or expanded on four occasions: 1934, 1936, 1951, and 1966. The general thrust of the first three revisions of the RLA responded to the concerns of workers and unions. The 1934 legislation made three major amendments to the act. It introduced criminal penalties in the case of violation of the act's provisions related to collective bargaining. It provided for a certification process through which workers chose their collective bargaining representation. It also created a National Railroad Adjustment Board (NRAB) and strengthened the Board of Mediation created in 1926 by reconstituting it as a National Mediation Board (NMB). The National Mediation Board was composed of three members, no more than two of whom could be members of the same political party. It was empowered to adjudicate representation questions, to foster mediation of disputes, and to propose arbitration in cases where mediation failed. The National Railway Adjustment Board was made up of 34 members, with equal halves representing carriers and unions. The NRAB was itself made up of four divisions, corresponding to different classifications of railroad employees. In the event of a dispute, a section of the NRAB could hear the facts and attempt to render a judgement. If the NRAB itself deadlocked on the dispute, the NMB was empowered to appoint a neutral umpire to break the deadlock. The RLA was further strengthened by the Supreme Court's 1937 decision in the case of Virginia Railway Company v. System Federation No. 40 (300 U.S. 515), which permitted judicial enforcement of the "duty to bargain" that was embodied in the 1934 amendments.

The 1936 legislation extended the act to cover common air carriers of both interstate and foreign commerce and transporters of the U.S. mail. This ensured that the RLA would remain an important component of American labor law in the decades that followed, as the railroads declined and airlines expanded robustly. The 1951 amendment of the act revised that portion of the original law that outlawed union security arrangements, allowing unions to bargain for union shops and dues checkoff arrangements.

The sweeping 1966 revision of the RLA made awards of the National Railroad Adjustment Board final and binding. While it provided parties the opportunity to seek court review of an unfavorable NRAB decision, it ensured that the grounds upon which such a review could be undertaken would be narrow. An NRAB award could be overturned only if the NRAB itself failed to comply with the provisions of the RLA; if the order exceeded the scope of the board's jurisdiction; or if there was evidence of fraud or corruption of a member of the NRAB.

By the end of the twentieth century, there were many calls for scrapping or drastically revising the Railway Labor Act by those who felt that a 1926 law was no longer suitable in an era of global commerce. Yet the RLA outlived its critics. The longest-lasting major piece of federal labor legislation, the RLA continued to influence American labor relations at the beginning of the twenty-first century.

Key Players

Coolidge, Calvin (1872-1933): Republican president known for having broken the Boston police strike as governor of Massachusetts in 1919. As president, he signed the RLA into law in 1926.

Hoover, Herbert C. (1874-1964): Secretary of commerce in the administrations of Warren G. Harding and Calvin Coolidge. He facilitated and encouraged the negotiations between railway unions and carriers that resulted in compromise provisions that were embodied in the RLA.

Howell, Robert (1864-1933): Republican senator from Nebraska. In his first term in office in 1923, he introduced legislation to scrap the Railroad Labor Board. His unsuccessful effort to pass this legislation pressured President Coolidge and the conservative Republican old guard in the Congress to write their own version of railway labor legislation, which they did in 1926.

Parker, James S. (1867-1933): Republican representative from New York. As chairman of the House Committee on Interstate and Foreign Commerce, he drafted the House version of the RLA.

Watson, James Eli (1864-1948): Republican senator from Indiana, and a member of the party's conservative old guard. He drafted the Senate's version of the RLA.

See also: Arbitration Act of 1888; Erdman Act; Pullman Strike; Railroad Strike of 1877; Texas and NOR v. Brotherhood of RSC.

Bibliography

Books

Davis, Colin J. Power at Odds: The 1922 National Railroad Shopmen's Strike. Urbana, IL: University of Illinois Press, 1997.

Dubofsky, Melvyn. The State and Labor in Modern America. Chapel Hill, NC: University of North Carolina Press, 1994.

O'Brien, Ruth Ann. Workers' Paradox: The Republican Origins of New Deal Labor Policy, 1886-1935. Chapel Hill, NC: University of North Carolina Press, 1998.

Twomey, David P. Labor Law and Legislation. Cincinnati, OH: Southwestern Publishing Company, 1980.

Zieger, Robert H. Republicans and Labor, 1919-1929. Lexington, KY: University of Kentucky Press, 1969.

—Joseph A. McCartin