Pay Raised

Six gentlemen met in rational argument last week and settled a railway dispute by giving $15,000,000 additional wages each year to the 89,000 conductors and trainmen of the 50 Eastern railroads. And by so much, of course, they added to the yearly operating expenses of those lines and deprived investors of their mete of profits. Their decision (it went into effect Dec. 1) was the first made under the Watson-Parker Railroad Act, and, although obedience by employers and workers is optional, they have set a precedent for labor arguments. This Act, passed last year, provides a code duello for railroaders, every nicety of which the factors of this case followed meticulously. Thus a year ago, the conductors and trainmen notified their employers that they wanted a 19% increase in pay--$38,000,000. "But no! we can't afford it," replied employers. "Let us send our seconds before the U. S. Mediation Board." "Quite agreeable," replied workmen. The Mediation Board, appointed under provisions of the Watson-Parker Act, listened to representatives of both sides. "Oh, get together, gentlemen," said the Mediation Board. "Oh, no," said the others. This seemed like stalemate. Then announced the Mediation Board, meditatively: "The employers will appoint two wise men, the trainmen two others. Then this U. S. Mediation Board will appoint two more men to represent the public, and the six will constitute a Board of Arbitration, whose decision we recommend that you follow, although that is not obligatory. You can force a strike if you are really stupid." The Board of Arbitration met the end of October. On it sat For the railroads: Robert V. Massey of the Pennsylvania and William Ayer Baldwin of the Erie. For the workers: E. P. Curtis, general secretary, Order of Railway Conductors, and Daniel L. Cease, editor, Railway Trainmen. For the public: William Delavan Baldwin, chairman, Otis Elevator Co., and Edgar Erastus Clark, onetime (1906-21) I. C. C. commissioner, now Washington, D. C. lawyer. They had just 45 days, according to law, to hear both sides of the dispute and to make their recommendations for settlement. They accomplished their task--the "public's" men siding with those of the workers, but not in all details of their demands. Said the dissenters, Employers William Ayer Baldwin and Robert V. Massey, in effect: "The physical improvements which the railroads have instituted the past few years make railroading easier and safer than theretofore. Eastern roads earned on the average 5.13% upon their investments last year, 2.76% in 1921 and 5.74% in 1916. This wage increase will detract from these meagre dividends and repel investors." The decision means that $4,000,000 must be deducted from the Pennsylvania Railroad's profits, that each of its 10,000,000 shares of stock (par value $50) surrenders 40-c- of his dividends. The Erie's wage tax increases by $650,000, or 37-c- for each of its 176,000 shares. But then, the Erie Railroad has never paid a common dividend, and in late years no preferred. Leonor Fresnel Loree's Delaware, Lackawanna & Western pays 23-c- a share ($400,000). His comment was: "The fact that the Arbitration Board has decided to increase the wages of the train service employes did not come as a surprise to me. Arbitrators usually try to effect a compromise between opposing elements. The fact, however, that the increase was so large is surprising." Railway shopmen, maintenance of way employes, clerks and telegraphers, have in recent months asked for pay increases which in a few cases were granted by employers. Other cases are to appear before the Mediation Board. There remain the engineers and firemen. Eastern firemen want $1 a day more; Southeastern engineers a general 15% boost. They have made claims on individual employers, but have not yet come to discussion. Canadian railroaders threatened a strike last week. But the smoothness of the U. S. arbitration made them pause for further arguments.