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Bible Encyclopedias

1911 Encyclopedia Britannica

Arbitration and Conciliation (Labour)

This article from the 1922 extension to the 1911 encyclopedia is an update of the information in the article Arbitration and Conciliation.

"ARBITRATION AND CONCILIATION [LABOUR] ( see 2.331). - Subsequently to 1910, many countries found it necessary to revise their position in regard to arbitration and conciliation in industrial disputes. The growing organization of workers in trade unions which was a marked feature of the last generation rapidly increased as a result of the demand for labour occasioned by the World War; and the feelings aroused by, and the conditions resulting from, the war led to increasing demands on behalf of workers in all countries,. which the strong economic position of the workers enabled them to enforce. The war itself in certain instances necessitated exceptional measures in order that the output of munitions of war might not be hindered by strikes and lockouts. Further, the development of industry has been towards more and more specialization and a still closer inter-relation of industry, so that the effects of strikes and lockouts extend far beyond those immediately concerned and may have most disastrous effects on the public. For this reason the state is forced, in the interests of the community, to take cognisance of trade disputes.

UNITED KINGDOM The position in the United Kingdom, at the outbreak of the World War, was that questions affecting rates of wages and conditions of employment were settled normally by discussion between the parties concerned. During the course of half a century, voluntary conciliation boards, standing joint committees or corresponding procedure had been established in all wellorganized industries and this procedure was instrumental in settling large numbers of disputes. In certain important industries, e.g. agriculture and transport, the workpeople and employers were not sufficiently organized in associations to render such permanent machinery practicable. The statutory powers of intervention in labour disputes held by the Government were derived solely from the Conciliation Act, 1896, an Act framed upon a purely voluntary basis. A connecting link between the activities of the conciliation boards and those of the Government in the settlement of labour disputes was the provision in the regulations governing the procedure of a number of boards for the reference of differences to arbitration under the auspices of the appropriate Government department (since 1916 the Ministry of Labour), and further by the policy of the department in not intervening in a dispute until the parties had exhausted their efforts to bring about an amicable settlement.

During the period immediately following the passing of the Conciliation Act, comparatively little use was made of the procedure of the Act, but the three years immediately preceding the war were years of very marked industrial unrest in the United Kingdom and there was a corresponding increase in the use made of the provisions of the Act. Serious consideration was given by the Government to the question of strengthening their powers in relation to labour disputes, but up to the outbreak of war no steps had been taken to formulate legislative proposals. In this connexion, reference may be made to the report of Sir George (afterwards Lord) Askwith of Dec. 1912, on the Industrial Disputes Investigation Act of Canada (Cd. 6603), and the report of the Industrial Council on Industrial Agreements (Cd. 6952).

1 Committee on Production

2 Munitions Acts

3 Whitley Committee

4 Industrial Courts Act

5 Compulsory Arbitration

6 Various Proposals

7 Other Countries

8 Bibliography

9 Federal Legislation

Committee on Production

The needs of the war and the abnormal conditions arising therefrom made both necessary and possible much stronger Government action in regard to stoppages of work. The outburst of patriotic feeling which followed the declaration of war resulted in employers and workpeople voluntarily bringing to a close the existing and pending disputes, but the economic conditions resulting from the war soon produced a fresh series of labour difficulties. In Feb. 1915, the Committee on Production, consisting of Sir George Askwith, Sir Francis Hopwood (Lord Southborough) and Sir George Gibb, representing the Board of Trade, the Admiralty and the War Office respectively, was established by the Government to enquire into and report as to the best steps to be taken " to ensure that the productive power of employees in engineering and ship-building establishments working for Government purposes should be made fully available, so as to meet the needs of the nation in the present emergency." With the establishment of the Ministry of Munitions, the functions of the Committee in relation to production were absorbed by that Ministry; but in the meantime the Committee had developed, as a result of the. acceptance by the Government of one of its earlier recommendations on the subject of stoppages of work, into an arbitration tribunal. It had no statutory position until the passing of the first Munitions of War Act in July 1915, but it quickly developed into the principal arbitration tribunal for the settlement of labour disputes and attained remarkable success. In 1917 the Committee was reorganized, representatives of employers and workpeople being added, to sit with the independent chairman. The Committee ceased to exist at the termination of the war when its place was taken by the Interim Court of Arbitration established under the Wages (Temporary Regulation) Act. During its period of existence, it issued over 3,750 awards covering most of the important industries in the country and dealing with all kinds of questions of wages and working conditions. In particular, reference may be made to the agreements negotiated, first in the engineering and allied trades and later in a large number of other trades, whereby the associations of employers and workpeople agreed to suspend existing agreements for the determination of general wages questions and to refer to the Committee on Production every four months the determination of the question what general alteration of wages, if any, was warranted by the abnormal conditions then existing and due to the war, with further power to determine special district cases.

The next important development after the institution of the Committee on Production in Feb. 1915, was the " Treasury Agreement " on the subject of the acceleration of output on Government work, negotiated between the Government and the principal trade-unions in March 1915. The Government's main proposals embodied in the Agreement were on the one hand to limit profits and on the other to prevent stoppages of work owing to trade disputes, and to secure the suspension during the war of trade-union restrictions on output. Although this agreement marked a definite stage of advance, real progress was not made until the Government embodied their proposals in the Munitions of War Act, 1915. This act was subsequently strengthened by two further Munitions of War Acts in 1916 and 1917.

Munitions Acts

Under the Munitions of War Acts, a stoppage of work arising out of a difference on or in connexion with munitions work (which expression was given a very wide interpretation as the result of decisions of the High Court) became illegal unless the difference had been reported to the Board of Trade (subsequently to the Ministry of Labour) and had not, within 21 days from the date of the report, been referred for settlement. The compulsory arbitration thus introduced by the Acts was necessarily accompanied by the statutory enforcement of awards issued thereunder. For this purpose the existing forms of arbitration tribunal were utilized, viz., (1) Committee on Production; (2) single arbitrator, selected by agreement between the parties or, failing agreement, appointed by the Board of Trade (subsequently by the Ministry of Labour); and (3) ad hoc boards of arbitration, consisting of an independent chairman, an employers' representative and a labour representative. This last form of tribunal had been introduced in 1908 for appointments under the Conciliation Act in order to meet any objection on the part of Labour that, however fair a single arbitrator might be, he could better determine the matters at issue if there were associated with him persons directly acquainted with the point of view of employers and workpeople respectively. The Act of 1915 left it to the option of the Board of Trade to refer any difference reported under the Act to arbitration; the Amending Act of 1916 required the Board of Trade to refer such a difference if satisfied that it was bona fide. Although the definition of " munitions work " under the Acts was very wide, it did not include some very important industries such as mining, transport and agriculture, but a further provision of the 1915 Act enabled the parts of the Act relative to the prohibition of strikes and lockouts and compulsory arbitration to be applied to work of any description (in addition to munitions work) by His Majesty by proclamation, and this course was adopted in certain instances (notably, South Wales coal miners, Lancashire card and blowing room operatives, and dockers at London, Liverpool and Glasgow). It may further be noted that the Munitions of War Acts contained no prohibition of incitement to strike. Consideration was given to this aspect of the problem and in Nov. 1915 the Defence of the Realm Regulation No. 42 was amended by the addition of the words in italics as indicated below: If any person attempts to cause mutiny, sedition or disaffection among any of His Majesty's forces or among the civilian population, or to impede or restrict the production, repair or transport of war material or any other work necessary for the prosecution of the war, he shall be guilty of an offence against these Regulations.

The Acts also authorized the Minister of Munitions inter alia to issue orders determining the rates of wages of particular classes of workpeople and a considerable number of orders were issued with regard to the rates of remuneration of women and girls. Other orders which had widespread effects were the orders made in Oct. 1917 , giving a bonus of 1 2% % on earnings to skilled time workers in engineering establishments and in shipyards, with a view to attempting to meet difficulties which had arisen owing to the altered relation between the earnings of skilled time workers and the unskilled and semi-skilled men on piece work. Three special arbitration tribunals were established for the determination of matters arising out of the various orders made under the 1916 and 1917 Acts.

Under the procedure of the Munitions of War Acts, arbitration became the normal method for the settlement of labour disputes. From the point of view of the workpeople, it was more expeditious to claim arbitration under the Acts than to endeavour to secure a settlement by conciliation machinery or other negotiations and, moreover, an award under the Acts was. statutorily enforceable. On the employers' side also, arbitration was often found to be the most satisfactory procedure; when so much work was being done for Government purposes, the employers' financial interest in the result of negotiations was diminished. A further development was that in many industries (e.g. the railways and coal mines) the conciliation boards fell into abeyance. During the war wages claims were necessarily determined largely in reference to the cost of living and consequently unions made claims for national advances in place of district claims. The net result, therefore, was a very large increase in the number of arbitrations under Government auspices and a falling off in conciliation settlements. During the four years 1915-8, nearly 8,000 awards were issued by arbitration tribunals under the Munitions of War Acts and, to a small extent, under the Conciliation Act, 1896. The Munitions of War Acts also introduced certain other features which have a considerable bearing on the settlement of labour differences, such as the power given to the Minister of Munitions under the Munitions of War Act, 1917, to extend an award, applying to the greater part of an industry, to other firms not party to the award but engaged on the same class of work.

It may be recorded that the New Ministries and Secretaries Act, 1916, transferred the powers of the Board of Trade under the Conciliation Act and the Munitions of War Acts to the newly created Ministry of Labour.

Wages Regulation Act. - Immediately after the Armistice, the Government, at a national conference of employers and workpeople on Nov. 13 1918, intimated that their post-war policy in relation to labour disputes was to leave employers and workpeople to adjust so far as possible their own differences. Certain proposals were placed before the conference for the period of transition while industry was changing over from war to peace conditions. These proposals, which were accepted by the employers and by the trade unions, were embodied in the Wages (Temporary Regulation) Act. The broad principle of that Act was to maintain as minimum rates, for a period of six months, the standard district rates existing at the date of the Armistice. Wages having been regulated during the war mainly in relation to the cost of living, they had at the date of the Armistice reached a level far above the pre-war rate. It was not anticipated that the cost of living would fall considerably immediately after the Armistice, while there was a fear that rapid demobilization might so disturb the labour market as to result in attempts at wage reduction of a kind which would lead to great industrial unrest. The Act repealed the prohibition of strikes and lockouts contained in the Munitions of War Acts, and limited compulsory arbitration to the wage standards dealt with in the new Act; it continued, in the Interim Court of Arbitration, the principle of a central arbitration tribunal which had been so successful in the form of the Committee on Production.

The termination of the war was followed by an outburst of unrest, and the position became so serious that in Feb. 1919, the Government summoned a further national conference of employers and workpeople to consider the position. A committee appointed by the conference subsequently made a number of proposals on questions relating to hours, wages, and general conditions of employment, unemployment and its prevention, and the best methods of promoting cooperation between capital and labour. As regards wages, one of the recommendations was the continuance of the Wages (Temporary Regulation) Act, 1918 for a further period of six months, and this recommendation was adopted by the Government in the Wages (Temporary Regulation) Extension Act, 1919.

In connexion with this period of unrest, special reference may be made to the coal-mining industry where the position became so acute in connexion with demands of the Miners' Federation, including a demand for the nationalization of the industry, that in Feb. 1919 the Government set up a commission (under the Coal Industry Commission Act) to inquire into the position of, and conditions prevailing in, the industry. (For the reports of this commission see Cmd. 359, 360 and 361 of 1919.) During the war a number of committees and commissions had been appointed by the Government to inquire into problems connected with labour disputes. Thus, there were (1) an inquiry by Lord Balfour of Burleigh and Sir Lynden Macassey, K.C., into " the cause and the circumstances of the apprehended differences affecting munition workers in the Clyde district," Dec. 1915; (2) commission appointed in June 1917 to "inquire into and report upon industrial unrest and to make recommendations to the Government " - reports summarized by Mr. G. N. Barnes, M.P. (Cd. 8696); (3) committee under the chairmanship of Mr. Justice Atkin, appointed in 1918 as a result of a strike of omnibus workers to investigate and report as to the relations which should be maintained between the wages of men and women, having regard to the interests of both, as well as the value of their work (Cd. 8 35); (4) committee appointed in 1918 under the chairmanship of Mr. Justice McCardie to inquire into matters connected with a strike of munition workers at Coventry and elsewhere in connexion with the Government embargoes on the transfer of employment of skilled men; and (5) committee appointed in Oct. 1916, under the chairmanship of Mr. J. H. Whitley, to make suggestions for securing a permanent improvement in the relations between employers and employed (Cd. 9 1 53, etc.).

Whitley Committee

The recommendations of the last-named committee were of far-reaching importance and in fact formed the basis of the Government's post-war policy in regard to industrial relations and strikes and lockouts. The committee recommended the setting up of joint industrial councils (now sometimes called " Whitley Councils ") in trades where employers and workpeople were sufficiently organized, the extension of trade boards for poorly organized trades, and the temporary establishment of other bodies for " intermediate " trades. The committee's recommendations with regard to the establishment of joint industrial councils were prefaced by a declaration to the effect that in the interests of the community it is vital that after the war cooperation of all classes, established during the war, should continue, more especially with regard to the relations between employers and employed, and that, for securing improvement in the latter, it is essential that any proposals put forward should offer to workpeople the means of attaining improved conditions of employment and a higher standard of comfort generally, and involve the enlistment of their active and continuous cooperation in the promotion of industry. The committee then recommended that H.M. Government should propose without delay to the various associations of employers and employed the establishment for each industry of an organization, representative of employers and workpeople, to have as its object the regular consideration of matters affecting the progress and well-being of the trade from the point of view of all those engaged in it so far as this is consistent with the general interest of the community. The committee recommended that the national councils should be supplemented by the creation of district councils and works committees to deal with district and local matters respectively and they outlined the questions with which the national councils, district councils, or works committees might deal. The Government intimated their acceptance of the recommendations of the Whitley Committee and at this date (Dec. 1920) 63 joint industrial councils have been established in various industries in the country. The Government have applied the machinery in their own industrial establishments and also in the civil service. The committee also issued a report on conciliation and arbitration and their recommendations thereon were as follows: (1) Whilst we are opposed to any system of compulsory arbitration, we are in favour of the extension of voluntary machiner y for the adjustment of disputes. Where the parties are unable to adjust their differences, we think that there should be means by which an independent inquiry may be made into the facts and circumstances of the dispute and an authoritative announcement made thereon, though we do not think that there should be any compulsory power of delaying strikes and lockouts.

(2) We further recommend that there should be established a standing arbitration council for cases where the parties wish to refer any dispute to arbitration, though it is desirable that single arbitrators should be available where the parties so desire.

The constitution and functions of the joint industrial councils are in many respects similar to those of conciliation boards, but whereas the latter have dealt mainly with questions affecting rates of wages and conditions of labour or demarcation of work between various classes of operatives, the industrial councils are designed to have a wider scope and can take into consideration matters of every kind which appertain to the welfare and smooth working of the industry. The encouragement of joint industrial councils formed a definite part of the broad policy of the Government to encourage industries so far as possible to settle their own disputes. In certain large and important industries (coal-mining, railways, agriculture) where the Government have not yet found it possible to relinquish their special war relations, while joint industrial councils have not been established, the Government have taken steps to set up special conciliation machinery. For example, in coal-mining special machinery is provided for by the Mining Industry Act of 1920; for railways, the Government have established special conciliation machinery, including a national wages board; and in agriculture, wages boards have been established under the Corn Production Act, 1917, and Agriculture Act, 1920. The voluntary conciliation machinery which was the fundamental factor in this country before the war, but which was in suspense during the war, is therefore now being reestablished on a substantially wider basis and the result of the establishment of the industrial councils has undoubtedly been greatly to increase the opportunities for the conciliatory discussion and adjustment of labour disputes.

The recommendation of the Whitley Committee with regard to trade boards was also adopted by the Government and, following the passing of the Trade Boards Act of 1918, the Government embarked on a policy of the extension of trade boards. These boards differ from Whitley Councils in that they consist partly of representatives of the employers and workpeople in the trade and partly of persons appointed by the Government; their determinations are statutorily enforceable as minimum rates and extend to the whole of the trade and, moreover, the boards are established in industries where the organization of employers and workpeople is weak. While they would not normally be included in the definition of conciliation machinery, it is advisable to note them in connexion therewith as, by establishing minimum rates of wages in low-paid industries, they tend to remove one of the root causes of labour unrest. Moreover, the meetings of employers and employed for trade board business afford opportunities for the mutual discussion of other matters and thus tend to improve the relations between the parties.

Industrial Courts Act

The recommendations of the Whitley Committee on the subject of conciliation and arbitration formed the basis of the Industrial Courts Act, which was passed in Nov. 1919. This act sets up alternative forms of tribunals to which recourse can be had, if both parties to a dispute agree. Of these, the principal tribunal is a permanent court of arbitration (called the Industrial Court) consisting of persons appointed by the Minister of Labour, of whom some are independent persons, some are persons representing employers, and some are persons representing workmen; there are also women members. There is a permanent president of the court and in addition there are chairmen of divisions of the court. The other forms of tribunal provided for by the Act are (a) single arbitrators and (b) boards of arbitration consisting of one or more persons nominated by the employers, an equal number nominated by the workpeople, with an independent chairman nominated by the minister. For the purpose of these boards of arbitration, panels of persons (including women) suitable to act in the respective capacities are constituted by the minister. The Industrial Courts Act further empowers the Minister of Labour in the case of disputes, either apprehended or existing, to appoint a court of inquiry, one of the objects of which is to put before the public an impartial account of the merits of the dispute. The Act continued until Sept. 30 1920 the principle of the Wages (Temporary Regulation) Acts, 1918 and 1919, that broadly speaking the wages ruling at the time of the Armistice should remain in force as standard minimum rates. (The Conciliation Act, 1896, continues in existence, but in practice its provisions are covered by the Industrial Courts Act.) The provisions in relation to the appointment of courts of inquiry, for the purpose of making a public inquiry and public report upon the facts and circumstances of a dispute likely to affect seriously the public interest, is based upon the Canadian Industrial Disputes Investigation Act, but while the British Act (like the Canadian Act) provides for the grant to the courts of inquiry of certain compulsory powers to secure the attendance of witnesses, the production of documents, etc., it differs from the Canadian Act inasmuch as it makes no attempt to prohibit a strike or lockout pending the inquiry. The British Act relies entirely upon the value of publicity and the effect of public opinion. In this connexion it may be mentioned that the experience of the working of the Canadian Act has shown that it has failed in practice to prohibit strikes or lockouts and that its success has lain in the power to secure an impartial inquiry and a public pronouncement upon the facts and circumstances of the disputes concerned.

During the first year of the Industrial Courts Act over 500 cases were referred to the arbitration of the industrial court, a number of the cases being of considerable importance as concerning the wage rates of the whole industry. During the same period courts of inquiry were appointed in three instances with satisfactory results.

Compulsory Arbitration

Certain aspects of conciliation and arbitration procedure in the United Kingdom have aroused special consideration during recent years. From time to time, proposals have been put forward in favour of declaring strikes and lockouts illegal and instituting compulsory arbitration; at trades union congresses, however, resolutions in favour of compulsory arbitration have been defeated by large majorities. Laws on this basis have existed for some time in Australasia and, under the pressure of war conditions, legal prohibition of strikes and lockouts and compulsory arbitration were introduced in the United Kingdom. Success was, however, only partial, and the experience of this period affords no reliable guide as to what might be expected to occur under more normal conditions. A large number of strikes and lockouts, some of considerable magnitude, did in fact occur, and probably the principal influence in restricting the number of stoppages during the war period was the patriotic spirit and the determination on the part of all classes to bring the war to a successful conclusion. The Whitley Committee on the relations between employers and employed came to the following conclusion on this subject: We are opposed to any system of compulsory arbitration; there is no reason to believe that such a system is generally desired by employers and employed and, in the absence.of such general acceptance, it is obvious that its imposition would lead to unrest. The experience of compulsory arbitration during the war has shown that it is not a successful method of avoiding disputes, and in normal times it would undoubtedly prove even less successful. Dis putes can only be avoided by agreement between employers and workers and by giving to the latter the greater measure of interest in the industry, advocated in our former reports; but agreement may naturally include the decision of both parties to refer any specified matter or matters to arbitration, whether this decision is reached before or after a dispute arises.

For the same reason we do not recommend any scheme relating to conciliation which compulsorily prevents strikes or lockouts pending inquiry.

Various Proposals

Another matter to which considerable attention has been given is the question of the extension to the whole of a trade or industry of the terms of an award or agreement applying to a particular body of employers. In 1913 the Industrial Council under the chairmanship of Sir George Askwith reported that, subject to the agreement fulfilling certain requirements and to an inquiry by the appropriate Government department, an agreement entered into between an association or associations of employers and workpeople covering a considerable part of the trade or district should be made applicable to the whole of the trade or district concerned. The question was considered at trades union congresses in 1912 and 1913 and also by the Labour party in 1913 and was rejected at all these meetings.

A recommendation appended to a number of the war agreements for four monthly arbitrations was put into effect by the Munitions of War Act, 1917, which contained a section empowering the Minister of Munitions to extend awards or agreements, if satisfied that they were binding upon the employers employing the majority of the persons engaged on or in connexion with munitions work in any trade or branch of a trade either generally or in a particular district, and a number of orders were issued for this purpose. Under the Wages (Temporary Regulation) Acts, the Minister of Labour had a certain limited power of extending awards and agreements. The report of the provisional joint committee of the industrial conference of 1919 also contained a recommendation for the extension of agreements providing for minimum rates of wages. Proposals with a view to extension were put forward at the time of the introduction of the Industrial Courts Bill, but the conditions which, in the view of the Government, must necessarily be attached to such a proposal, were not acceptable to the workpeople's organizations and accordingly the Industrial Courts Act did not contain any provisions for that purpose. This subject is one upon which there is clearly considerable divergence of opinion.

Another movement to which reference may be made is the proposals which have been put forward from time to time for the setting up of a national joint organization of employers and workpeople to cover all trades. In 1911 an industrial council was established under the chairmanship of Sir George Askwith, consisting of 13 leading representatives of employers and 13 leading representatives of labour from all branches of industry, but save for a report on the extension of industrial agreements, the council did comparatively little work and in due course it lapsed. In connexion with the industrial conference in Feb. 1919, proposals were made for the establishment of a national joint industrial council representative of employers and workpeople, but so far it has not been found practicable to establish such a body. A somewhat similar movement is the proposal, also so far unsuccessful, to establish a national association of joint industrial councils. The lack of success which these proposals have so far achieved would appear to suggest that the highly organized industries prefer to be able to deal independently with their own difficulties and are averse to intervention by outside bodies.

The increased organization of employers and workpeople 'in the United Kingdom which resulted from war conditions has had substantial effects on the machinery for conciliation and arbitration. Labour realized from its strong economic position the power of combination, but attempts at general strikes after the war have also indicated the limitations of the strike weapon, and in addition have impressed on the trade-union movement the need for coordination. This is having effect in the proposals now under discussion for the establishment of a General Staff for labour. On the other hand, recent strikes have produced in certain quarters demands for the institution of some measure such as a ballot - to be taken in a manner prescribed by statute - prior to a declaration of a strike, but the trade unions are not likely willingly to forego the " lightning strike." With organization comes the establishment of machinery for the mutual discussion of differences, and discussion often leads to an amicable settlement: on the other hand, with employers and workpeople strongly organized in their respective associations, the claims advanced on behalf of labour develop beyond claims about wages and working conditions, and extend to questions of principle such as labour's right to share in the management and control of industry. Further, when a strike or lockout does occur, it often has far-reaching effects and impresses itself on the mind of the public, who tend to overlook the numerous differences which might have led to stoppages of work, but were adjusted by discussion. It is largely on the ground of the effect on the public that the State is held to be justified in introducing restrictive legislation for dealing with strikes and lockouts, particularly in the group of industries known as " public utility " services, and, failing settlement, of taking exceptional powers such as those conferred on the Government under the Emergency Powers Act, 1920. A further development of organization has been that the larger trade unions appear in some instances to have become over-centralized, and in this connexion the growth of works committees may well be worth watching. Generally it may be said that in recent years there has been in the United Kingdom a very marked increase in the regular meetings of employers and employed for the purpose of discussion of matters which may be at issue between them; and while it cannot yet be said that there is freedom from suspicion and distrust there is clear evidence of the growth of a desire for full and frank discussion of all matters affecting the relations between employers and employed.

The conciliation and arbitration machinery of the British Government is frankly based on the acceptance of organization by employers and workmen into their respective associations; the joint industrial council scheme is based on organization, and the Industrial Courts Act definitely provides that a difference shall not be referred by the Ministry of Labour to arbitration until there has been failure to adjust the difference by the conciliation machinery existing in the industry.

British Colonial Legislation In connexion with British colonial legislation on the subject of conciliation and arbitration, it may be recorded that in Canada the Industrial Disputes Investigation Act of 1907 continues to represent the legislative position of the Government.

In Australasia a considerable number of amendments have been made. In New Zealand the Industrial Conciliation and Arbitration Act has been amended to enable awards and agreements to be amended to meet alterations in conditions of employment and the cost of living. Further, the existing machinery was strengthened by the Labour Disputes Investigation Act, 1913, which provides machinery for the investigation of disputes not coming within the scope of the Industrial Conciliation and Arbitration Act. The 1913 Act provides for conference of the parties with a view to securing an amicable settlement, or, in the alternative, investigation by labour disputes committees. Before a strike may lawfully take place, a ballot of the workers is taken by the registrar of industrial unions and the result of the ballot publicly notified. After the lapse of seven days from the publication of such result, the workers are free to strike, whatever the result of the ballot may have been. Similar provisions are made to apply in the case of lockouts. Most of the states of Australia have passed new laws on this subject. In Victoria, under the Factory and Shops Acts of 1915 and 1919, and in Tasmania under the Wages Boards Acts of 1910, 191 I, 1913 and 1917, there is a wages board system; in Victoria there is no prohibition of strikes and lockouts, but in Tasmania penalties are provided for stoppages of work on account of any matter in respect of which a board has made a determination. In Western Australia, the Industrial Arbitration Act of 1912 provides for an Industrial Arbitration Court and prohibits strikes and lockouts, while in New South Wales under the Industrial Arbitration Acts of 1912, 1916, 1918 and 1919, in Queensland under the Industrial Arbitration Act of 1916, and in South Australia under the Factory Acts of 1907, 1908, 1910 and 1915 and the Industrial Arbitration Acts of 1912, 1915 and 1916, there are both a wages board and an industrial court system. In accordance with the provisions of the Acts in New South Wales and Queensland, the industrial courts in those states have been exercising the functions of wages boards, and the work of the existing boards has been greatly curtailed. Under the industrial court system, an industry does not technically come under review until a dispute has actually arisen, but most of the Acts have given the president of the court power to summon a compulsory conference. The Commonwealth of Australia has also recently amended its procedure by means of the Industrial Peace Act, 1920, which sets up certain advisory councils (Commonwealth and District) for considering matters affecting the prevention and settlement of trade disputes and further authorizes the governor-general to set up special tribunals (Commonwealth and District) empowered to issue enforceable awards on any industrial disputes (I) referred by the parties to the dispute, or (2) as to which the tribunal or other appropriate authority has convened a compulsory conference and a complete agreement has not been reached.

Other Countries

The movement in the United States is dealt with in a subsequent section of this article. A considerable number of other countries have amended their laws on the subject of the settlement of strikes and lockouts.

In Norway a law dated Aug. 1915 introduced for the first time in that country machinery for the settlement of labour disputes by the State. One noteworthy feature of the new measure was the application of the principle of compulsory investigation and delay before a stoppage of work takes place, in which respect it resembles the Canadian Industrial Disputes Investigation Act of 1907. Another noteworthy feature is the compulsory registration of trade unions and employers' associations and the recognition and regulation of collective agreements. Two methods of procedure are established for the prevention and settlement of labour disputes. Questions arising out of existing collective agreements must be brought before a specially constituted labour court, while those originating from other matters affecting labour are to be submitted to conciliation boards to be set up throughout the country. This was followed in 1916 by a compulsory arbitration law. It should also be noted that the Provisional Works Councils Act of July 1920 requires the establishment of a works council in every establishment employing regularly throughout the year not less than 50 workers, on a demand of one-fourth of the workpeople. The functions of the councils are advisory only; they may consider and express an opinion on matters concerning the establishment so far as they relate to working conditions, rates of remuneration, workshop regulations, welfare institutions, etc. No penalty is laid down for failure to comply with the terms of this law.

In Sweden the law of 1906 providing for the appointment of conciliators was subjected to inquiry from 1916 onwards with a view to revision and, as a result, it was superseded by three new measures all dated April 1920. The first is a law amending and extending the original law in respect of the appointment of local official conciliators; the second establishes a permanent Arbitration Court (consisting of three impartial persons nominated by the Crown and representatives of organized employers and workpeople) to deal with disputes arising out of collective agreements, without recourse to strikes or lockouts or to legal process in the ordinary courts; whilst the third relates to the appointment, on request, of special arbitrators for individual disputes arising out of collective agreements and involving matters of minor importance. Recourse to the Arbitration Court is voluntary.

In Rumania in Aug. 1920 a bill was passed for settling industrial disputes. Strikes and lockouts without recourse to conciliation are prohibited in establishments employing ten or more persons. When a dispute arises, a conference is required to be held in the presence of an official of the Ministry of Labour and if an agreement is reached the decision becomes obligatory on all the parties. Arbitration may be resorted to where conciliation fails and is compulsory in the case of Government establishments and what might be broadly described as " public utility " services. Provision is made for widening the scope of the proceedings and altering the constitution of the Arbitration Court so that the decision may be made applicable to all local establishments similar to those involved in the initial dispute. The decision arrived at is obligatory on all parties.

In Switzerland the Factory Act of 1877, which was amended in certain respects in 1905, was repealed and superseded by a new labour law of June 1914, which included within its scope measures for averting and settling industrial disputes. The Act provided, with a view to the amicable settlement of disputes which are calculated to lead to a strike or lockout, for the appointment of permanent cantonal conciliation committees which might intervene either on their own initiative or at the request of the authorities or of the parties directly concerned. Persons summoned before these tribunals are obliged, under penalty, to appear. A certain number of employers and workpeople in any industry may mutually agree to constitute a conciliation committee so far as those employers and workpeople are concerned.

In Germany a decree of the new Government of Dec. 1918 continued, for the purpose of the settlement of labour disputes and pending arrangements of further statutory regulations, the system of district conciliation committees which had been established during the war. The constitution, functions and powers of these conciliation committees are similar to those of the industrial courts which have been in existence in Germany for many years, in so far as these latter deal with the settlement of ordinary labour disputes. An Act of Jan. 1920 requires the setting up of works councils, one of whose functions it is to appeal to the conciliation committee or to an arbitration board to be agreed upon, failing a settlement of disputes at the works. It may be noted that these works councils are vested with very wide powers such as the right to demand information of all business transactions. The works councils are to be united in district councils whose work will be coordinated in a federal works council; these can meet representatives of employers in district economic councils and in a federal economic council.

A provisional federal economic council has already been established although the subordinate organizations are not yet in existence. A bill has been under consideration during 1920 in which it is proposed to make recourse to conciliation compulsory and to make the decisions of the conciliation boards obligatory (a) in public services where they are established by law, and (b) in industries where they exist by reason of a collective agreement; in other cases a strike or lockout may be called in spite of a decision, if a ballot is taken and a two-thirds majority is secured in favour of a stoppage. Meanwhile, as the outcome of a strike of electrical workers in Berlin, a presidential order was issued in Nov. 1920, relative to strikes and lockouts in establishments supplying the community with gas, water or electricity. Under the order lockouts and strikes in such establishments are permissible only after the lapse of three days from the publication of an award by the competent conciliation committee; persons who incite to a strike or lockout, prohibited under the order, or who, for the purpose of bringing about such a strike, perform acts in regard to a workshop, machinery or equipment by which the regular carrying on of the undertaking is hampered or rendered impossible, are liable to imprisonment or a fine - liability to penalty is also incurred by anyone who proclaims a lockout in the circumstances defined; if establishments of the nature indicated are brought entirely or partially to a standstill as a result of a lockout or strike, the Minister of the Interior is empowered to take emergency measures for the maintenance of supplies, including the satisfaction of justifiable demands made by the workers. The cost of putting such measures into operation falls upon the owner of the establishment.


The principal sources of information are the series of reports and periodica s issued formerly by the Board of Trade and now by the Ministry of Labour, viz.: Proceedings under the Conciliation Act, including latterly work done under the Munitions of War Acts, Wages (Temporary Regulation) Acts and the Industrial Courts Act; Strikes and Lockouts - these reports contain some particulars of the work of voluntary conciliation and arbitration boards; second Report on Rules of Voluntary Conciliation and Arbitration Boards and Joint Committees; fourth Abstract of Foreign Labour Statistics. The monthly Labour Gazette continues to give valuable information both as to the position in the United Kingdom and abroad; and the information as to the dominions and foreign countries is now supplemented by a new quarterly periodical entitled Labour Overseas. Special publications of value are the series of reports of the Committee on the Relations between Employers and Employed - better known as the " Whitley Committee " (Cd. 9 1 53, etc.); Memoranda issued by the Board of Trade on Laws in the British Dominions and Foreign Countries affecting strikes and lockouts with special reference to Public Utility Services (Cd. 6081 of 1912); Report of Sir George Askwith on the Industrial Disputes Investigation Act of Canada in Dec. 1912 (Cd. 6603 of 1912); Report of the Industrial Council of 1913 on Enquiry into Industrial Agreements (Cd. 6952); and Reports of the Coal Industry Commission (Cmd. 359, 360 and 361 of 1919); see also the reports of the various countries, e.g. New Zealand Official Year Book; Official Year Book of the Commonwealth of Australia; Reports of the United States Department of Labor, etc. See also Articles on Industrial Councils, Labour Regulation, Strikes And Lockouts, Trade Boards. (H. J. W.) United States In the United States the movement for state legislation for voluntary arbitration and conciliation progressed steadily, until in 1920 a majority of states had legislation providing for the settlement of industrial disputes. Many of these states have permanent boards of conciliation and arbitration with two to six members, though three is the usual number. In some states the labour commissioner acts as mediator, while in others a chief mediator is appointed by industrial commissions together with temporary boards of arbitration. Twenty states provide for compulsory investigations, and in several others it is permitted under varying conditions. Twelve provide for the enforcement of an arbitration award when arbitration has been agreed upon by both sides. In 17 states the voluntary agreement to arbitrate must contain a promise to abstain from strikes and lockouts during arbitration proceedings, and two states, Colorado and Kansas, make strikes and lockouts unlawful and a ground for fines and imprisonment. The law of 1915 gives to the Industrial Commission of Colorado the power to compel a hearing in the case of an industrial dispute and to deliver an award which is not mandatory. As in the Canadian Industrial Disputes Act, change of terms of employment, strikes and lockouts are prohibited until after 30 days' notice and until after a hearing and award, if such hearing is started within the time of notice. Though it does not prohibit the right to strike, it delays the strike. Kansas, an agricultural state, by creating, in 1920, a Court of Industrial Relations, established compulsory arbitra tion. The law applies to industries connected with the manufacture of food products, clothing and wearing apparel in common use; to mining or the production of fuel; to transportation of the above-mentioned articles; and to all public utilities and. common carriers, which are declared to be affected with a public interest and subject to supervision by the state. The court, which consists of three judges appointed by the governor for a three-year term, is authorized to summon the parties to a dispute before it, to investigate the conditions of the industry and to make a reasonable award. It may bring suit in the Supreme Court of the state to compel compliance with any of its orders. Either party, if aggrieved by an award, may sue in the state court to compel the Court of Industrial Relations to issue a reasonable order. Though the law recognizes the right of collective bargaining and the right of the individual to quit work, the right of labour to enforce its claims is forbidden. In the case of actual suspension or limitation of the operation of an industry, the court may take it over and operate it during the emergency.

Federal Legislation

The Federal legislation on mediation and arbitration of 1888 and 1895 applying to common carriers has been superseded by three Acts: the Act of 1913 (the Newlands Act); section 8 of the Act creating the Department of Labor (1913); and title III. of the Transportation Act of 1920. The Newlands Act provided for the appointment of a Federal board for voluntary mediation and conciliation to consist of three members, a Commissioner and two other Government officials, appointed by the President with the advice and consent of the Senate. In four years this board functioned in 71 controversies, 14 of which were settled partly or wholly by arbitration and 52 by mediation. Failure of the Act, however, to meet the railway labour crisis in the fall of 1916 and again in March 1917 resulted in the first instance in Congressional action in the shape of the Adamson law granting the basic eight-hour day to trainmen, and in the second instance in the appointment by the President of a committee from the Council of National Defence to mediate. This meant, in effect, the breakdown of the Newlands Act, though it continued on the statute books subject to the limitation imposed on it by the Transportation Act of 1920. When the Government assumed control of the railways in Dec. 1917, a labour policy was immediately agreed upon. A Railway Wage Board was appointed to make recommendations to the DirectorGeneral, and a Division of Labor, headed by a brotherhood (union) official, was created to be the connecting link between employees and officials on the one hand and the Railway Boards of Adjustment. Later a permanent Advisory Board on " Railway Wages and Working Conditions " was created. Successive orders of the Director-General formulated a liberal labour policy, and machinery for handling disputes under these orders was established in the form of three Boards of Adjustment, composed equally of representatives of the administration and the workers.

A similar policy was adopted in the Transportation Act of 1920, which makes it the duty of the railways and their employees to " exert every reasonable effort and adopt every available means to avoid any interruption to the operation of any carrier " growing out of any dispute involving grievances, rules or working conditions. In case a dispute arises, it is to be decided, if possible, in mutual conferences of representatives of each side. Disputes that cannot be settled in this way are to go before Railway Boards of Labor Adjustment which may be established by agreement between any road or group of roads and the workers. Except for a stipulation that these boards must contain representatives of organized labour, their size and composition are left to the discretion of the parties concerned. Matters may come before the Adjustment Boards either upon application by the road or the organized workers affected, or upon written petition of a hundred organized workers, or upon the board's own motion or upon the request of the Railroad Labor Board. This last-mentioned board is set up by the Act as the final tribunal for the settlement of railway labour disputes. It is composed of nine members appointed by the President with the advice and consent of the Senate to represent in equal proportion the workers, the employers and the public. During their five-year term of office, members of the board must not be active members or officers of labour organizations or hold stocks or bonds of any carrier. Disputes may come before the Railroad Labor Board either upon failure of Adjustment Boards or directly. A majority vote is all that is necessary to constitute a decision except on matters taken up directly, in which case one of the members representing the public must concur in the decision. It has power to suspend any decision on wages made by the initial conference if, in its opinion, such a decision involves increases in wages or salaries which would necessitate a substantial readjustment of rates. In such cases the board must, after hearings, affirm or modify the suspended decision, and must also hold hearings on alleged violations of decisions and publish its decisions.

The Act of March 4 1913, creating a Department of Labor, provides that the Secretary of Labor shall have power to act as mediator and to appoint commissioners of conciliation in labour disputes, whenever in his judgment the interests of industrial peace require it to be done. In case mediation fails, arbitration may be proposed by the mediators, who cannot act as arbitrators. During the five years inclusive, 1915-9, the Secretary of Labor took cognizance of 3,644 cases and effected 2 ,539 adjustments. During 1919 alone 1,780 assignments of commissioners of conciliation resulted in 1,223 adjustments. In addition to the direct efforts of the Secretary of Labor, two other Boards of Labor Adjustment were established as part of the war machinery of the country.

The President's Mediation Commission was appointed in the fall of 1917 to conduct an investigation into the underlying causes of labour unrest which was threatening the output of material needed for war industries and to make specific adjustments. The Secretary of Labor was appointed as Chairman of the Commission. It made investigations in the copper mines of Arizona, the California oil-fields, the Pacific Coast telephone dispute, the unrest in the lumber industry of the north-west, and the packing industry. Settlements were made in all disputes except in the lumber industry, generally after arbitration had failed. In Jan. 1918, the Secretary of Labor upon nomination of representatives of capital and labour appointed a War Labor Conference Board to devise a method of labour adjustment which would be acceptable to employers and workers.

As a result of the Conference Board's report, the National War Labor Board was created by Presidential proclamation in April 1918. The membership consisted of two joint chairmen, five representatives of employees' organizations and five representatives of employers' organizations. As stated in the Proclamation, its powers and duties were " to settle by mediation and conciliation controversies arising between employers and workers in fields of production necessary for the effective conduct of the war, or in other fields of national activity, delays and obstructions in which might, in the opinion of the National Board, affect detrimentally such production " and to provide necessary machinery for these purposes. Its authority did not extend to controversies between employers and workers in any field of industrial or other activity where there was by agreement or by Federal law a means of settlement which had not been invoked. This provision excluded from the jurisdiction of the Board, except by way of appeal, a large group of cases. The ship-building industry had set up by agreement its own Labor Adjustment Board; the Ordnance Department and other producing departments of the Government had created special industrial service sections to consider the complaints of their employees; the coalmining industry had its labour policy controlled by agreement of all parties with the Fuel Administration and the Government had adopted a separate labour policy for the railways. The statement of principles and policies contained in the report, which governed the decisions and which became an official expression of the Government's labour policy, was as follows: (r) abolition of strikes and lockouts during the war; (2) equal right of employers and workers to organize without discrimination; (3) right of collective bargaining; ( 4 ) observance of the status quo ante bellum as to union or open shop in a given establishment and as to union standards of wages, hours and other conditions of employment, except that the War Labor Board might grant improvements in labour conditions as the situation warranted; (5) maintenance of established safeguards and regulations for the protection of the health and safety of the workers; (6) payment of equal wages for equal work to women in industry and allotment of tasks proportionate to their strength; (7) recognition of the basic eight-hour day in all cases in which existing laws required it, in other cases settlement of the question of hours with regard to Governmental necessities and the welfare, health and proper comfort of the workers; (8) maintenance of maximum production; (9) regard to be had for labour standards, wage scale and other conditions prevailing in the localities affected, in fixing wages, hours and conditions of labour; (to) right of all workers to a living wage which insures subsistence of the worker and his family in health and reasonable comfort. Provision was made for the settlement where possible by local mediation and conciliation and in event of failure of local machinery, for hearings before the National Board. When the National Board found it impossible to settle the controversy, provision was made for the appointment of an umpire by the National Board or by the President from a panel of disinterested persons. In the enforcements of its awards, the National War Labor Board had no special legal sanction or penalty either to force any party to submit disputes to arbitration or to enforce its awards. So outspoken however was public opinion on the necessity of avoiding interruptions in the war industries and so far-reaching were the wartime powers of the Government over both the employers and workers, that the indirect powers of the Board were sufficient. In only three cases were the Board's awards resisted. In two instances where the employers discriminated against the union employees and refused to abide by the decision in favour of the men, the President was sustained by Congress in taking over the industries. In the case of the strike by the organized workers at Bridgeport, Conn., against the Board's award, the President's threat of unemployment enforced by Governmental agencies compelled the men to return to work.

Besides legislative programmes, the Federal Government has made several other attempts to devise plans for the adjustment of labour disputes. In 1913 President Wilson appointed the Industriall Relations Commission to diagnose the cause of industrial unrest, and in the fall and winter of 1919 he appointed two industrial conferences to formulate a reconstruction labour policy. None of the programmes suggested has been given practical application. Experience during the war demonstrated the possibility of successful Government intervention in industrial disputes through mediation. Even voluntary arbitration was resorted to only in a few instances. Legislation was still needed in 1921 to extend the field of Federal mediation with regard to disputes involving agencies of interstate commerce and disputes so vital and comprehensive in extent that existing state agencies are unable to meet the situation. Though the Secretary of Labor is empowered to intervene in such cases, his intervention introduces political and trade union partizanship, which is objectionable to the parties to the dispute. The rapid increase of state agencies has created the need for cooperation between the state and Federal agencies. (For collective bargaining and arbitration in private industries see TRADE UNIONISM.) Bibliography. - John R. Commons and John B. Andrews, Principles of Labor Legislation (1920); U.S. Bureau of Labor Statistics, Bulletins, Nos. 148, 166, 186, 213, 244, 257; U.S. Bureau of Labor Statistics, Monthly Labor Review; U.S. Secretary of Labor, Annual Reports; American Labor Legislation Review, Annual Summaries; U.S. Board of Mediation and Conciliation, Report under Newlands Act, Dec. 1917; Alexander M. Bing, War-Time Strikes and their Adjustment (1921). ( J. R. Co.)

Copyright Statement
These files are public domain.

Bibliography Information
Chisholm, Hugh, General Editor. Entry for 'Arbitration and Conciliation (Labour)'. 1911 Encyclopedia Britanica. 1910.

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