Part 2

The next section of our work was printed inquiries sent to all the employers whom we could get the names of from the State Department of Labor, and to all labor unions on record. These inquiries were just about the same as those sent to the employers, and in a general way we asked both the labor unions and the employers what they thought of the present law on employers' liability, how they thought it met the situation; and we asked them how they would like a law on workmen's compensation, describing it very briefly. We received replies from only a small proportion of the inquiries we sent out, but a large enough number to give us some general idea of the feeling of both the employers and the laboring people in the State on this subject. I can say positively, however, that we found no satisfaction; practically nobody liked the law. The employers disliked it for one reason and the workmen disliked it for another, and so nobody was satisfied with it.

Another printed inquiry we sent to the insurance companies. This was more in the line of investigation, however, as we got from them not opinions so much as figures showing how much they had received in premiums from employers for liability insurance, and what proportion of this had been spent in paying actual claims, thus showing us what proportion was, so to speak, wasted in the business of defending claims.

We then wrote letters, not printed inquiries, but letters containing a list of questions to a great many lawyers, and to all the judges in the State, asking their opinion about the constitutional questions involved. That, I think, ended the inquiry section of our work.

Then we held public hearings, five or six up the State and as many in New York City, and tried to make the invitations as general as we could. Many of us felt that those hearings were not going to be important and perhaps were a waste of money, but after we had them I believe we all felt that they were worth while. They perhaps did not furnish us with any definite statistical information, but they did put us in touch with the feelings of the people of the State on this subject, and gave us a more concrete view of the subject than we could have gotten by correspondence or by any statistical inquiry, and brought us in touch with the people on both sides of the question, who were interested in the problem. But quite apart from the value to us, of these written inquiries and of the public hearings, in informing us on the situation, they were valuable in arousing interest all over the State, and in educating the public in regard to the problem.

We were particularly gratified to see the way in which labor unions seized the opportunity to become interested and to educate themselves in regard to employers' liability and workmen's compensation. When we started out last fall most of the labor unions that answered our inquiries did not know what we were talking about, and now I hardly think there is a union of any size in the State that is not in a position to know what it wants in the matter of employers' liability and workmen's' compensation.

The next section of our work was statistical inquiry--a regular statistical investigation. The bulk of this was done for us under Mr. Hatch's direction at the New York State Labor Department. A study was made of some fourteen hundred actual industrial accident cases, both injury and death, to show what was the loss of income to the man injured, how much he received from the employer, how much he paid to a lawyer and what was the effect of the accident upon his family; in other words, a study of the economic cost of work accidents.

In addition to that Mr. Hatch conducted an inquiry into the cost of industrial accidents to some three hundred employers, showing how much they paid in a year on account of industrial accidents and into what different channels that money went; how much of it went to employers' liability and insurance premiums; how much went to the workmen and how much to the hospitals and so forth. All of this was exceedingly valuable in giving us information as to the conditions in our own State.

In addition to this the Commission conducted a similar investigation of three hundred fatal industrial accident cases to determine their economic effect upon the family and the income loss, of compensation received and all that. These fatal accident cases we secured in a perfectly impartial way by taking a year's fatal industrial accidents reported to the coroners of Manhattan Borough and Erie County, where Buffalo is situated. As a result of these two inquiries we have a mass of statistics on this subject. We were able to put into our report a statement, from the statistics, of just about what proportion of workmen who were injured received anything to compensate them for the income loss, and with regard to the workmen killed, what proportion of the dependents received anything. Those four divisions, I think, cover our preliminary work.

Then came the business of preparing and writing the report. The rough draft was prepared by two or three members of the Commission, and the counsel, in different sections. When it was in printed proof for the first time, Senator Wainwright, the chairman, called the whole Commission together and informed us that he intended to make us read the whole report aloud, all sitting together, so that every member of the Commission might feel that he had written the report and that it was his report. That idea astounded me, I will admit, when I first heard it, because I thought it was going to take us the rest of the year to do it; but it turned out to be a very excellent plan, and we actually did that. We sat down for three days without stopping, except for meals, and read the report aloud, and there is no member of the Commission who did not make suggestions, and valuable suggestions, and I think I may say that we all feel that it is our report.

When it came to the bills which we introduced we followed somewhat the same plan. We went over every line and word of the bills, of course in much greater detail than we did the report, and the bills are the result of a giving in here and a giving in there, as you can readily imagine. They did not represent just exactly what every one of us wanted to do, but they represent what we could agree to do, and the Legislature has done us the honor to take our advice.

And now just a word in regard to these bills. The first one is called the Optional Bill. It does two things: It remedies the glaring injustice of the present law on the basis of negligence by modifying the fellow-servant rule, by making all fellow-servants in positions of authority vice-principals instead of fellow-servants; by doing away with the extreme application of the assumption of risk rule which allows an employe to assume the risk of an employe's negligence by remaining in employment, and changes the burden of proof of contributory negligence over to the defendant. Those three things we felt it to be necessary to change in the employer's liability law on the basis of negligence, even if we never changed it in any other particular. In addition to this feature of the bill, there is afforded to the employes and employers, if they wish to escape this situation, by an amendment to the employer's liability law, the opportunity of making a contract. That is the option feature of the bill; there is nothing particularly interesting or original about that. Some members of the Commission were for it because it would force the employers into compensation, and some members were for it because they thought it remedied an injustice in the present law which they could not stand for, but, at any rate, all but two of us were able to agree on that.

Then the second bill, which we call the Compulsory Compensation Act for dangerous trades, is our solution of two difficulties which we met and which, no doubt, all of the other commissions are having to meet. These two difficulties are the constitutional difficulty, the fact that we have written constitutions limiting our powers along all these lines; and, secondly, the interstate competitive difficulty, the fact that in this country our laws are made by States and we have state legislative lines, but no state competitive lines--the old cry of the manufacturer, that if you put a burden upon him in New York State he cannot compete with a manufacturer in Pennsylvania and New Jersey, and will, therefore, either have to go out of business or out of the State. That difficulty of interstate competition we felt to be a real one. Whether it would actually drive the manufacturer out of business or not, it would inevitably hinder the passing of our bill, because the manufacturers of the State in a body would oppose it.

The constitutional difficulty, to be a little more definite, in our case seemed to be pretty serious; we had only two lawyers in the State who wrote us that they thought a general compulsory compensation act similar to the English law would be constitutional, but we had a great deal of advice to the effect that if we could draw our bill so it would apply to the risk of the trade, and make the compensation depend upon the inherent risk of the trade, that that would be constitutional.

With these two difficulties in mind we drew the bill applying to dangerous trades. As you know, it provides compensation for all workmen injured in eight specially dangerous trades, if they were injured either through the fault of the employer or any of his agents, which is plainly perfectly constitutional; or if they were injured in any sense through any risk inherent or necessary as a risk of the trade. The bill does not take away any statutory or common law rights that the workman now has, but he must choose between one or the other. If he begins proceedings under the compensation act, he loses his right to sue and _vice versâ_.

The importance of this bill, in my mind, is very great. I think that is the way to go at it in this country. If the employer and the workman both profit by the enterprise they should both assume the risk of the trade, and that principle, I think, is what is established by our compulsory compensation bill.

I want to make clear that the list of dangerous trades in this law is not an inclusive list of dangerous trades by any means. There is no reason why we should draw the line where we did draw it. Our reason in selecting these dangerous trades instead of all dangerous trades, as we originally had our list drawn, was a purely utilitarian opportunist reason. It was our solution of the second legislative difficulty in this country; that is, the interstate competition. We thought that it would be a good plan to get our entering wedge in on the industries which did not directly compete with other industries outside of the State. For instance, the builder in New York State competes with the builder in New York State, generally speaking; and the railroad in New York State competes with the railroad in New York State, generally speaking, and not with the outside railroads. We are quite frank in saying that we thought we could get this bill passed if we did not make it hit the manufacturer to begin with. We intend that it shall cover him in time, and just as soon as we can, make it cover him; but it seemed a fair as well as a wise thing to introduce the principle and get the employers used to the burden, and get the insurance rate adjusted for injuries, so that it would not be a serious competitive difficulty.

Those two reasons, then, explain this bill; we limited it to the risks of trade instead of having it cover all accidents in the course of employment, as the representative list did, because we believed that that was the constitutional line for us to act on, and we limited it to those dangerous trades which, generally speaking, are not involved in interstate competition, because we thought we could pass it easier and it would be fair to try it out on those employers first.

PROF. HENRY R. SEAGER (New York): I should like to add just a word along the line of the practical difficulties that all of our commissions face when it comes to getting legislation. Some members of the New York Commission felt that it would be a mistake to try to make any report at all this last winter when the proposal was first advanced. We felt that we had a very big problem. That, in addition to studying the experience in this country and getting reports on European laws, we ought to send some one over or go over ourselves to the other side and see just how the European laws operate. The consideration that finally led us to make a report, and try to get legislation, was the political situation in New York.

As the winter advanced it became very clear that it was a highly opportune time to get through legislation that had popular sentiment behind it. The legislative members of our Commission were so impressed by that aspect of the matter that they were impatient, some of them, to bring in bills without any report at all to back them up, and that consideration finally led all of us to feel that we should hurry as much as we could and get in the best report we could in the short time that was allowed, with the hope that the bills we recommend, if reasonable and fair, would be passed. It was that situation that led us to make a report which at some points was not altogether satisfactory to the members of the Commission; and that consideration, I think, justified our action because, as it turned out, the Legislature was in a mood to act on our recommendations. The voluntary law was a bill, aside from the compensation feature of it, that had slumbered in Albany for five or six years in spite of the efforts of the labor representatives to have something done. That it was a favorable situation was shown by the comparative ease with which that bill was passed, in somewhat modified form, when we put ourselves behind it.

It is those practical considerations, gentlemen, it seems to me, that we must consider quite as much as the ideal solution of this question for many years in this country. I say that because as a professor of political economy, as a theorist, I perhaps would not be expected to take that view of the matter.

GEORGE W. SMITH (New York): I was sort of a moderate edition of the employers' representative on the New York State Commission. I was one against about thirteen. Of course, you can imagine that my advice could not have been considered very seriously, but I am willing to say that they certainly did give me considerable consideration, for the reason that I was not really a radical against any legislation that would be fair; and I feel that the employers of New York State felt largely as I did.

I cannot help but remark, however, about the point that Professor Seager raised, of the opportunity that seemed to present itself at this session of our Legislature. I do not suppose I ought to criticise, but I hope that similar conditions will not exist in other States at the time this legislation is up, because I think it is of a very important character, and should not be put through for any personal reasons or in order to bring political capital to any of the legislative members. I suppose it is pretty well known that there were a great many shattered reputations in the Legislature of New York State this year, and it is always a pretty handy thing to have around an opportunity to do something for the boys that work hard for a living. I do not blame those that were in favor of this legislation for taking advantage of that very favorable opportunity, but it certainly was a good opportunity and was well taken advantage of.

I had to smile, however, on a number of occasions at the attitude of some of the labor representatives. They did not seem to realize, a good many of them, how important this legislation was and how beneficial it was to them; but if they could have gone behind the scenes, and had a heart-to-heart talk with some of the employers, they would have realized that the employers did not like it very well.

As for one of the bills being designated as a voluntary or optional bill by the removal and absolute wiping out almost of all of the employers' defenses, it practically makes that almost a compulsory bill. However, I believe that all the employers in the country realize that the time has arrived when some fair legislation must be enacted, and the only thing that I think should be well considered is not to go so far that you are going to put the country in a bad financial state.

PROF. SEAGER: If Mr. Mitchell would say something about the labor situation when we started out I think it would be very interesting.

JOHN MITCHELL (New York): The measures have been discussed so thoroughly by the other members of the Commission that I shall not attempt to discuss them now. When this Commission was first appointed in New York State, as Miss Eastman stated, the workmen knew very little about the systems of compensation in Europe, and they knew little about the principles of workmen's compensation. The Commission was appointed not because of a demand for workmen's compensation, but because of a demand for a comprehensive system of employers' liability. But after the Commission was appointed, and it was suggested that they go into an investigation of workmen's compensation, the unions took the matter up and made investigations on their own account, and drafted bills which they thought would cover the matter to their satisfaction. Of course, as was to be expected, they asked for a rate of compensation that was very much higher than anything that prevailed in Europe.

While I, personally, was in sympathy with the workmen in their desire to have the very best system of compensation that it was possible to obtain, and one better than any they have in Europe, yet I think that the more conservative of the trade-union workmen recognized that we could not go very far beyond the system prevailing in England or in Great Britain until other States, and particularly the adjoining States, should also take up the matter. The consequence is, however, that as the matter was developed, and as the workmen were brought into the discussion of the matter with the Commission, that very many of them modified their original demands and were willing to accept the principles laid down both in the optional and in the compulsory bills which have passed the Legislature.

It is, of course, not to be expected, either in New York or anywhere else, I assume, that the bill passed by the New York Legislature meets at all the desires of the workingmen. That is to say, they will continue to ask what they will eventually succeed in having, a compulsory law that will include all the trades. I think there is no special demand for a bill to include agricultural and domestic service.

The great difficulty right now in New York is concern as to the scale of compensation. The New York workmen are not satisfied with one-half wages. They have asked recently that the bill be made full wages. I think, however, that somewhere between one-half wages and what they are asking will be accepted as a final solution of the difficulty.

I want to make this one personal observation about these measures, and in this respect I think my views are not quite in accord with the views of all of my fellow-workers. I think the purpose of all this legislation should be first to do substantial justice to the workingmen, and I think the second consideration should be to take out of the courts all this long and expensive litigation, in order that the money that is not paid by employers, or whatever is paid by them, may be used for the relief of those who are suffering from industrial accidents. I do not believe, however, that the workmen should have the right to sue his employer, and, failing to win his suit, to go back and receive his compensation. I differ with most workmen in that respect, because I think if he has the right first to sue, and, failing to win his suit, to then accept the scale of compensation, that it is a temptation, an almost irresistible temptation, for him to sue, because it costs very little to enter the suit, and inasmuch as he knows in advance that if he fails to win the suit he will have his compensation any way, too many workmen would elect to sue perhaps on a contingent fee, and then go back if they failed to win and take the compensation. I do believe, however, that he should have the choice of suing under the employer's liability law or accepting the compensation, but, as I say, I do not think he ought to have both rights. I believe that perhaps the labor men who have made the most thorough investigation into the subject will agree with me that it is a fair proposition to give him his choice, but not both choices.

ILLINOIS.

MASON B. STARRING (Illinois): The Chairman of the Illinois Commission, Mr. Rawn, is unavoidably absent to-day and probably will not be able to attend the conference to-morrow. This second Illinois Commission is young. The act creating it was passed at a special meeting of the Legislature, and the appointments to membership on the Commission are of very recent date. In convening the Commission, the Governor of the State of Illinois expressed the hope that the members of the Commission would not indulge in deliberation or consideration of the features of a bill until first they had fully advised themselves as to the facts which would necessarily and properly govern the conclusions which they hoped to attain. Illinois, therefore, is in the position of being a student of this matter, and the progress and work of its Commission so far, I believe, to be largely that of investigation. We come here to learn. And were it not for the fact that the question of age destroys the illusion, when we heard the lady from New York (Miss Eastman) speak, we certainly would have felt that we were "sitting at the feet of Liberty Enlightening the World."

I want to suggest to this meeting, Mr. Chairman, that there is no one connected with our Commission so familiar with all its workings, looking at it both from the side of the employer and the employe, as is our secretary. The Commission is composed of six men chosen from among the most respected and eminent leaders of the workingmen in the State of Illinois, supplemented by a selection by the Governor of six men from the ranks of the employers. The Chairman is Ira G. Rawn, president of the Monon Railroad, and the Secretary is Edwin R. Wright, president of the Illinois State Federation of Labor. I would suggest, Mr. Chairman, that it might please the members of this meeting, and certainly it would please the members of the Illinois Commission, if you would ask Mr. Wright to speak to you.

EDWIN R. WRIGHT (Illinois): We have not in Illinois progressed far enough to make any report showing any particular progress. So far we have been trying to find ourselves, and to find a starting point from which we can work. It took us a meeting or two to become acquainted with each other, and another meeting or so to try and understand the different points of view.