Part 7

JOHN MITCHELL (New York): I do not know whether there will be any advantage in the discussion of the character of a bill that we should want to adopt or as to the measure that any group would desire. I hold no commission that gives me a right to represent the workingmen of the United States, notwithstanding that I am an officer of the American Federation of Labor. As a matter of fact, the American Federation of Labor, which is representative of practically all the organized workmen in the United States, has not itself decided formally upon the character of a compensation bill that they would favor. But I do have some knowledge of the general sentiment that prevails in the country, and I think that in part I can say for the workingmen of the United States, and they, after all, the ones most affected by this legislation, they are the ones that are demanding it, and it is for their relief that it is going to be enacted. I believe I can say for them, as Mr. Buchanan has said, that the workingmen will not be willing to waive their right to enter the courts and sue for damages. To that extent, I think, he is correct, and that the workmen would not be willing to waive their right to sue.

On the other hand, I believe that if they understood the circumstances prevailing in Great Britain that they would not insist upon their right to sue, and then failing to win their suit to have their compensation. I do not have with me a table I have of statistics giving the amount secured in suits for damages and the average amount paid under the Workmen's Compensation Act of Great Britain, but my recollection is that the workmen of Great Britain, in cases where they have instituted suit under the employers' liability law or the common law, have received approximately $852, and that the average compensation paid under the Workmen's Compensation Act has been $848. My recollection is that the workingmen of Great Britain have received on the average more under the compensation act than they have under the liability act, and I think can we take it for granted that where men have sued under the liability laws of Great Britain it has been in cases where there has been a likelihood of responsibility on the part of the employer. Unless the workingman was convinced that he had a reasonably good case, he would not proceed under the liability laws, but would, on the other hand, proceed under the compensation act.

Now, if the workingmen of Great Britain recover a larger amount under the Workingmen's Compensation Act than they do under the liability laws, is it not likely that they would do the same thing in the United States? In other words, has not the right of the workingman of Great Britain to proceed under the liability laws simply been a temptation to him to sue in the hope, and the false hope, as it turns out, that he might recover a larger amount than he would under the compensation act; and if the figures I have given you are approximately correct, has the result not been that the workingman, lured by the false hope that he would secure a large verdict, has given a large part of the money he would have received under the compensation act to attorneys, because he has had to pay the costs of the courts, he has had to pay his lawyers their fees, although possibly not in as large an amount as would be the case here, because in England the court fixes the amount of the attorney's fees; and has he not taken from the employer money that ought to have been used to compensate the men for accidents. Whenever a burden is put upon the employer that means nothing to the workman, it simply deprives the employer of the opportunity of paying a larger amount under the compensation act.

Now, it is not because of any particular sympathy I have for the employer in the matter, although I want to be absolutely just to him, but it is because I want to protect the workingman and see that he receives the largest possible amount as a reward or as a compensation for his injury, that I am not in favor of giving the workman the right to sue under the liability laws, and, failing to win his suit, to then proceed under the compensation act. I think it is holding out to the workman a false hope, and I know the practice in England has been simply a lure, and has caused him to waste his own money and waste the money of the employer without any benefit to himself.

On the other hand, when I say that I believe the workman should have the right to sue, I believe that because I believe there should be something done to cause the employer to prevent accidents, and I think the fact that a workman once in a while may secure a verdict of $5000, $10,000 or $15,000 is an incentive to the employer to prevent accidents. And when all is said and done, gentlemen, one of the principal purposes of this Conference should be to prevent accidents. Your compensation, quite apart from preventing accidents, is necessary, yet it is of a hundred times more importance that a life be saved than it is that some man or his dependents should receive $3000 or $4000 for his life. It is all very well to receive $1000 for the loss of an eye or the loss of an arm, but it is much better, not only for that man, but also for society, that the eye or the arm be not lost.

Gentlemen, this gathering, if I may just make this general observation, is perhaps one of the most important gatherings that has met in the United States, because it is going to give impetus to a great movement to change our entire system of employers' liability. I doubt not but that within a very few years our courts will so broaden their vision, and so broaden their decisions, that they will find means, even under our present constitution, to recognize the growing demand on the part of the people for relief from our iniquitous system of employers' liability law. I do not know how fast we can go; no doubt those of us whose lives have been spent among workingmen, and who have daily been brought in contact with those who are suffering either from accidents directly or the dependents of those who have been killed, may grow impatient in our desire to secure a remedy, but we cannot go faster than the courts will let us go, and we cannot go faster than the Constitution of the United States will let us go, but we ought to go at least as fast as they will permit us to go. If some State will take the lead and adopt a comprehensive system of compensation, and put it up to the courts and have decisions rendered, we would then know just what we could do. In any event, gentlemen, I believe that the workingmen will not be at all satisfied either with the suggestion sometimes made of a contribution on their part or with any law that removes from the employer the incentive to prevent accidents.

SHERMAN KINGSLEY (Chicago): Gentlemen, in my duties as superintendent of the United Charities of Chicago, I come in touch with a great many families where the breadwinner has been removed, and where the burden of supporting the family devolves upon the wife and the children. In this State, within the year, as you know, we have met with a very great disaster down at Cherry, where a large number of men were killed in a very spectacular manner. The press of this city and country was alive with the stories of that disaster for weeks. It was debated in our Legislature, it was talked about in university halls and preached about from the pulpits. I doubt if ever in the history of industrial accidents 267 men ever had as much written, said and thought and felt about themselves and their families as was the case down at Cherry.

I was asked to read a paper at the National Conference of Charities and Corrections at St. Louis, my subject being: "Compensation from the Point of View of What a Relief Society Would Consider Adequate." I tried to get a number of accidents equal to that of the victims of Cherry; that is, accidents that happened one at a time in the commonplace fashion, where, instead of having the press interested in it for weeks, the man will get three lines in a paper in an obscure corner, saying that So-and-so had his head cut off or had suffered an accident which cost his life. I got from ten societies similar to the United Charities of Chicago, in ten of the largest cities of the country, something over one hundred accident cases, and I have a couple of charts which show the kind of compensation that was obtained by those one-at-a-time, obscure accidents, and then what happened in the case of the men down at Cherry, where they met their death so dramatically. One chart shows the compensation they received, either through court action or from the employer, and it shows what 50 families received where the man was killed in a one-at-a-time accident in ten of the large cities of this country. The second is a chart of 50 families in Cherry, and shows that they received $1800 apiece; while the 50 one-at-a-time families only received $8749, in amounts all the way from $3000 down to $7.

I suppose that a damage suit of $10,000 or $15,000 does have some compelling effect upon an employer with reference to protective machinery, but I think that the greatest thing in the world that will happen in the way of preventing accidents is to make it dead sure that every accident will receive some just measure of compensation. Instead of having 50 accidents get $8749, if they come to $3000 apiece, making a total of $150,000, that fact will have a great deal more effect in preventing accidents than has the present plan.

Now, I have another chart which shows the whole relief story of Cherry, and indicates the effect of public opinion upon the compensation received by the sufferers. The Red Cross Society, the Legislature and the whole community became interested in Cherry. The money contributed by the public, by the Legislature and by the community generally amounted to $87,240 odd dollars. In our one-at-a-time accidents something was done for the victims, of course; they were cared for in day nurseries, in orphan asylums, in hospitals and the county agents gave help and the charities gave some help, but not in any such amount as the Cherry sufferers received. Twenty-four of these one-at-a-time cases were cases where the children were taken out of school and put to work or to begging, or the family took in boarders, and in some instances the criminal courts had played their part. Whatever it was, it was a certain fixed amount. (Down in Cherry the amount contributed is to go to the families in monthly payments, spreading over some five years, and in amounts suited to the number of the children and the ages of the children in the family.) The deterioration in the income of the families, resulting from the one-at-a-time accidents, was 64 per cent. Notwithstanding the wife and the children did everything they could, the income in these families has deteriorated almost two-thirds. In one case, where there was permanent disability, a man was awarded in one court $22,500. The case was appealed from court to court during a number of years, and finally the man received absolutely nothing.

Those are some of the general consequences, and I believe that in this matter of prevention nothing is going to have so wholesome and so certain an effect in the prevention of accidents as to have accidents cost money, and cost about what they ought to cost, and cost it with a certainty. You can see what happened in the case of these 50 families, where the accidents happened one at a time; those families only cost something like $8000, and some of that even, in fact, quite a large part of it, was a gift from the employer and not compensation.

(A motion was adopted thanking Mr. Kingsley for his graphic presentation of the facts.)

JOHN FLORA (Illinois): I see in this tentative "code" no provision for doing away with the defenses of the employers before the courts. The Chicago Federation of Labor, which I directly represent on the Illinois Commission, holds that any compensation bill in the State of Illinois is not worth the paper it is written on, unless we have a provision also doing away with the right of the employer to bring into the defense what is known in court decisions as assumption of risk, contributory negligence and the fellow-servant doctrine.

CHAIRMAN MERCER: Let me suggest that further down in this bill the common law remedies for all industrial accidents covered by this bill are intended to be repealed. If they are repealed, that would dispose of your question.

MR. FLORA: Very well. I want to say then in reference to this first section, that it appeals to me a great deal stronger than anything else. I happen to be a building trades man myself, and I want to say individually, as a member of the Illinois Commission, that I am in favor of a compensation law that will cover everybody. I do not favor taking out any class of industry and making that one class amenable to a certain law, and allowing another class to go without any protection whatever. I hold that the widow of a man who is killed in a non-hazardous occupation suffers just as much as the widow of a man who is killed in a hazardous occupation. I do not know how the constitution would affect this matter in this State. That, I presume, is something that the Illinois Commission would have to look up, but nevertheless I think it is a great deal better than the New York proposition. I never have been very much taken up with the idea of having two different bills in New York. I feel that they might have gone further and have made one bill that would cover every occupation. I hold with the rest of the representatives of the working people that the working people will never agree to surrender their right to go into court under the common law.

MR. DAWSON (New York): I have not made up my mind at all as to this question, whether the right of the workingman who is injured, or of his family in the event of his death, to proceed under the existing law, should be taken away; whether he should be compelled to exercise an option and abide by it, or whether he should be permitted to proceed under the law through the courts, and in case he fails to establish that he has been injured by the employer's wrongful or negligent act, still be entitled to compensation under the compensation act.

There are, however, some considerations that arise in my mind. In the first place, the tendency of the proposed legislation in this country has been to do away with certain of the defenses, even though a compensation act be adopted. An argument in favor of that has been that by doing away with these defenses the employers will be made very glad indeed to accept a compensation act. I think the impression is that the bill which was passed by the Ohio Legislature, and since vetoed by the Governor, was intended chiefly to influence public opinion there in favor of abandoning entirely the old method of dealing with industrial accidents. Certainly in New York there is no question but that the weakening of the defenses was directly for the purpose of getting the manufacturers to take advantage of the permissive act. As I understand it, a similar proposition is now being brought forward in Wisconsin. If, in spite of this, by any chance the fixed policy in this country should ultimately be the same as in Great Britain; namely, to preserve to workmen their rights under the common law and under statute law relating to employers' liability, either in an optional form or in a form which would still give the benefit under the workmen's compensation act, though defeated in the courts, it occurs to me that this weakening of defenses would be a peculiarly dangerous thing for us to do. The present situation in the United States is that the employers' liability theory, the negligence theory has, notwithstanding these defenses, in the main, been pushed just as far as the courts and the juries could push it, to cover many accidents. Notwithstanding that we chafe at these defenses, the courts and juries have gone just as far as they could go, on the theory that an employer was to be held liable _only_ for his own fault. This is due to a strong sense of natural justice and a desire to compensate as many as possible.

It is safe to say that nine out of ten verdicts rendered in this country, and sustained by the higher courts when brought before them, are not cases where the actual negligence of the employer is clear at all, but instead it is reasoned out by precedents established by these same courts, under which employers have been held responsible; precedents which, of course, have been carried still further in the case of public liability; that is, to others than employes. If we pass a compensation law so that every injury is surely compensated, what resulted in Great Britain is what I should expect to find in this country if we do not weaken these defenses; that is, that after a compensation act is passed, the disposition of courts and juries will shift to the other side; namely, that instead of aiming to stretch the theory of employers' liability and negligence to the utmost limit in order to give verdict, they will tighten them by establishing new precedents until it will be nearly impossible to get a verdict for the negligence of the employer. This is true now in Great Britain unless an exceedingly clear case of actual personal negligence has been established, or such negligence on the part of those who have been appointed to perform the employers' duties in his business, that his agents' negligence is fairly attributable to him. It is by reason of that fact that the courts have gradually veered to the position, that the reservation of that right in Great Britain has done no harm. I say no harm advisedly, because I am told that the British insurance companies regard it as a quantity negligible in the computation of their rates.

Under those circumstances should we not be particularly careful how we proceed about weakening defenses? And should not the manner in which we proceed be definitely based upon what we suppose will be the ultimate form of these laws; that is, whether the right to proceed under the employers' liability act will be wiped out entirely, whether it will be reserved as an option to be exercised only by abandoning the other right entirely, or whether, as in Great Britain, there would still remain the right when defeated, to claim under the compensation act.

There are reasons which appeal to me very strongly why the British principle should be accepted, but I am not clear that I shall be of that opinion in the end. One of these reasons is: This compensation, if it is given under a compensation act, will be for the purpose of trying to see that all persons who are injured in the course of carrying on an industry are taken care of. It has a public purpose; namely, to prevent the piling up of the burden upon public and private charity, the very things we saw set forth in the chart that Mr. Kingsley exhibited a few minutes ago. Is there any reason why, when we have tried to make that provision for the inevitable result of industry, we should refuse to punish those rare cases of misconduct which mean that men have grossly trifled with the safety of their employes? I am not quite clear that there is any good reason. I am confident that an examination of the British decisions, since they put the first compensation act upon the statute books in 1907, would show that there have been very few cases, indeed, in which the employers have been held liable, where they ought not to have been actually punished for misconduct.

There is one consideration, however, that does not appeal to me which has been brought forward in the argument here, and I wish to speak about it. It is that by reason of such punishment employers will be more careful. I am sorry to say that such does not appear to be true. All the evidence to the present time is that employers are most careless where there is nothing for which they are held responsible but negligence. They are enormously more careful when they are held for every accident that happens. Experience all over the world has shown this to be true, and I want to add one thing that is almost more important still; they are still more careful in countries where they are not even held individually responsible, but are only held responsible for the payment of insurance premiums. The greatest amount of prevention and the largest amount of care exercised by employers anywhere in the world is in those countries which have compulsory or obligatory insurance laws. The reason is very simple: nearly every employer does not think that a catastrophe, due to his negligence, will ever happen. But when you hold him under a compensation act for every accident, big or little, negligent or not, and accidents are happening every day, and there is a good deal of money being paid more or less continually, he will be much more careful. Again, when you introduce a compulsory insurance system, if his institution is not up to standard, he finds he is paying three times as big a rate of premium, perhaps, as another employer in the same business, and he does not wait for accidents to happen, but takes measures at once to prevent them, and so get a present and permanent benefit in a reduction of his rate. There has nothing been found yet which will cause so effective prevention of accidents as compulsory insurance; for it is, after all, the certainty that the want of it costs money that causes an employer to be more careful, and not the possibility that it may cost him a great deal more money or perhaps even ruin him.

MR. HARPER: Further, as to the right of the Legislature to take away from the employe his right of action at common law, in most of the bills which have been suggested, it is provided that some method of arbitration shall be substituted for the ordinary action at law, and, in my judgment, where the nature of the injury and the amount of the compensation only, and not the question of the liability, is left to the arbitrators and taken away from the courts, the courts ought to sustain it. It might be wise, however, in all cases to provide for an appeal to a court of record.

I want to ask the Chairman and the other attorneys here, especially to discuss a suggestion I desire to make in regard to limiting the right of the employe to bring such common law action and substituting in part the compensation system. The suggestion is this: Under the doctrine of respondeat superior, which has been in vogue for two or three hundred years, the employe was originally given the right of action against the employer, not only for the negligent acts of the employer himself, but also for the negligent acts of his servants and employes while exercising the duties of their employment. That was a judge-made privilege extended to the employe. It is not a constitutional right, and might we not take that power from him and substitute therefore a compensation system? That is, might we not provide in a compulsory compensation act that the employe, where the negligence is attributable not to the master himself, primarily, but to his servant or his employe, that his compensation in that case should be compulsory and the employe would not have a right to his action at common law.

HENRY W. BULLOCK (Indiana): We do not have a Commission in Indiana. At the last meeting of the General Assembly I prepared on behalf of the State Federation of Labor a bill for the creation of a Commission, which, unfortunately, was smothered. We are fortunate, however, in Indiana, in having a Governor who personally is in favor of compensation, so we have that much of a start on the future.