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(c) If no agreement is arrived at by 31st March, any question at issue as to the service conditions shall be referred to the Industrial Court for settlement.

In the event of either party including wages in any scheme for the future conditions of service under paragraph (a) hereof, and the parties not reaching agreement thereon, such will form part of the questions at issue to be referred to the Industrial Court.

(d) The Shipping Federation has approved of these terms of settlement and will be represented as hitherto in the proceedings which are to take place under clauses (a), (b) and (c) of this agreement.

(e) Under clauses (a), (b) and (c) of this agreement negotiations are to be begun forthwith between the parties, and it is provided that if either party include wages in any scheme for the future conditions of service and there is failure to agree, the wages of the operators are to be determined by arbitration.

Resumption of work was to take place in accordance with the scale of wages fixed to come into operation on 1st December, 1925 (in which the rates ranged from £7 15s. per month in the first year to £18 17s. 6d. in the ninth year).

The agreement also contained clauses providing for the reinstatement of the operators on strike, as from the date. of resumption on the staff roll of the companies, in the positions and with the seniority they occupied with their company prior to striking.

In accordance with this agreement certain questions were referred to the Industrial Court for settlement (see p. 10).

One case occurred during the year in which a "Court of Investigation" consisting of an independent chairman, appointed by the Minister, together with representatives nominated by the parties concerned was set up under Section 2 (1) of the Conciliation Act, 1896. In addition, the Department received the report of the Court of Investigation appointed in 1925 regarding wages in the Scottish shale oil industry (see Report for the year 1925, pp. 15 to 17).

Particulars of these cases are given below.

(i) National Coal Trimming Tariff.

At the request of the parties a Court of Investigation was appointed by the Minister of Labour on 20th September, 1926, to inquire into the respective demands of the shipowners and trimmers as submitted to the Court, and to make recommendations to the parties thereon." The Court heard evidence from the parties on various dates in October. As the members of the Court did not find it possible to reach complete agreement on all the questions at issue, they requested the Chairman (Mr. Harold Morris, K.C.) to issue a report himself: the report, however,

embodied, with slight modifications, the provisional agreements reached on certain points by the Court as a whole.

The shipowners, through the Shipping Federation, claimed a general reduction of the 1920 tariff of piecework rates for coal trimming, which had already been reduced by 333 per cent., by a further 163 per cent.; that is to say, they asked that the rates payable under the tariff should be reduced to 50 per cent. of the 1920 rates. They also claimed a number of detailed alterations in certain clauses of the tariff. The workpeople, through the Transport and General Workers' Union, counterclaimed either for the postponement of the claim, pending the settlement of the coal mining dispute and the resumption of trade, or, alternatively, for a restoration of 10 per cent. of the amount already taken from the tariff, and for an alteration in clauses 25 and 26 of the tariff relating to easy trimmers." The Court over

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ruled the men's application for postponement, but added the assurance that the workpeople's case would not be prejudiced in any way by the fact that they were at present out of work.

The report deals first with the various detailed alterations suggested in certain clauses of the tariff. These are highly technical and cannot be given here; but it may be mentioned that the Chairman estimates the total net effeet of all the clause amendments with which he has dealt as something like a reduction of 1 per cent. on tariff rates in the Bristol Channel and of 2 per cent. on the North-East Coast; while the corresponding figure for the other areas. probably lies somewhere between 1 and 2 per cent."

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As regards the employers' claim for a general reduction of 16 per cent., and the workpeople's counterclaim for an increase of 10 per cent., the report examines at length the arguments of the parties. The following paragraphs are taken from the concluding section of the report :- After full consideration I have come to the conclusion that I am not in a position to accept the employers' suggestion that the workpeople are receiving more than the inherent value of their services. I can only say that the tendencies operating before the war were likely to produce rates which if anything erred and still err on the side of generosity. It is possible, however, to consider the present rates from another aspect. The figures given show that the real value of those rates is fairly comparable with that of pre-war rates. I am, therefore, entitled to ask whether, having regard to the state of the coal shipping industry and the need for strict economy in every direction, it is reasonable to ask the trimmers. to make a further contribution to ease the employers' position, or whether, on the other hand, it is reasonable to ask the employers to add to their expenses by increasing rates at the present time.

"So far as the workpeople's counter-claim is concerned, I am unable to find any evidence showing any improvement in the shipping industry which would justify me in putting an increased burden upon the employers.

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As to the employers' application, on the other hand, I have reached the conclusion that some reduction is justifiable. Freights are now actually below pre-war level and exports are low. Trimming charges represent a small but not a negligible fraction of the shipowners' expenses, and the owners undoubtedly now in a position in which they must seek economies in every possible item, however small. Nevertheless, I think that the reduction asked for is too large. The effect of granting in full the claim of the employers would be an immediate reduction of about 5s. 6d. in the £ on present earnings. The compulsory and sudden lowering of the workpeople's standard of living which such a reduction would involve could not fail to create hardship, particularly as they are at present seriously impoverished by the long stoppage.

"I have, therefore, had to consider what smaller reduction is justifiable, and in doing so, have had to take into account the probable effect upon future earnings of any reduction in rates which may be adopted. There is little doubt that for a few months after trade resumes, exports will be heavy and earnings correspondingly high; but, inasmuch as it is impossible to gauge the extent and duration of the boom, I am of opinion that this is a factor which ought not to weigh heavily. . .

I am of opinion and recommend that the reduction in rates should be 6 per cent. so as to reduce the present rates to 60 per cent. of the 1920 tariff rates.”

(ii) Scottish Shale Oil Industry.

The Court of Investigation set up by representatives of the employers and of the workers engaged in the Scottish shale oil industry, as the result of an agreement signed between the parties on 11th December, 1925, to consider certain matters in dispute between them, issued its report on 13th March, 1926. The following particulars are taken from the report :—

The shale mining industry is carried on in Westlothian, Midlothian, and Lanarkshire by six companies, all of which are now controlled by Scottish Oils, Limited. This company holds all the ordinary shares in the six shale mining companies, and the second-charge mortgage debentures of one company, but not their preference shares, nor (where these exist) the remainder of their debentures; it also owns and operates a refinery at Grangemouth for the refining of crude oil imported from the Persian.

oilfields.

The total number of workers employed at the mines operated by the six companies, and at the shale oil works, candle house, and acid works in connection therewith, was nearly 6,900 in October, 1925. This is exclusive of about 250 employed at Grangemouth at the refineries engaged in refining Persian crude oil, and of about 500 coal miners employed at two coal mines also owned by the companies. The men employed at the shale mines work the same hours as at coal mines, viz., a nominal

seven-hour day, if underground workers, and 46 hours a week, if surface workers. At the retorting and refining works the processes are continuous; 1,240 process workers and others work a seven-day week.

Wages reached their highest point in 1920, when the nominal shift rate for workers at the face touched 19s. There were three reductions (of 2s., 4s., and 3s., respectively) in 1921, and further reductions in 1923. The average rates earned by the various workers during the four weeks ended 3rd November, 1925, were as follows:

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The industry is at present suffering from serious depression, owing to the unremunerative prices obtained for the oil products and for sulphate of ammonia. Whereas in 1913-4 the products from a ton of shale brought in 12s. 6d., at a cost of 9s. 11d., in the half-year ended September, 1925, the corresponding figures were 12s. 5d. and 14s. 2d.; in other words, a profit of 2s. 7d. per ton had been turned into a loss of 1s. 9d. a ton. Wages during the half-year ended September, 1925, represented nearly half the cost of production; and coal, chemicals, pitwood and timber, and other mining and manufacturing stores, a further 35 per cent.

For about twenty years prior to April, 1925, the shale companies had supplied the Admiralty with fuel oil. The contracts, which had at one time been favourable to the Admiralty, had latterly proved favourable to the companies; and in the summer of 1925 the Admiralty intimated that the contract which had

expired on 31st March, 1925, would not be renewed. In view of the heavy losses which they were incurring the companies put before the men's representatives proposals for reductions in wages and the closing of certain of the least remunerative undertakings. Negotiations followed, and the notices of reductions were postponed from time to time until 8th November, 1925, when the companies, having then obtained a provisional undertaking from the Admiralty to purchase a quantity of fuel oil from 1st April, 1926, made an offer to the men to continue work at all mines and works, at least until the end of March, 1926, provided that, as from 11th November, the workers would accept a reduction of wages of 10 per cent., with a minimum shift rate of 6s. 8d. for men and 2s. for boys. These terms were not acceptable to the men, and an almost complete stoppage took place at the mines and works as from 11th November.

The stoppage was brought to an end on 11th December, 1925, when an agreement was signed between the parties, setting up a Court of Investigation and providing for the immediate resumption at the old wage rates of the preparatory work and the ultimate full resumption at all except the poorest undertakings, the latter to be reopened when they could be operated without loss. It was assumed that the Court would report in time to enable the new rates to be fixed for work other than the preparatory work which, it was estimated, it would take several weeks to complete.

The Court was set up

(a) To afford the union an opportunity to prove that Scottish Oils, Limited, and the shale oil companies are a single unit so far as the shareholders and debenture holders are concerned and should be a single unit so far as the workers are concerned, and that therefore it is possible legally for the employers to maintain the present rates of wages paid by them in the shale oil industry from revenue derived from that industry or from revenue derived by Scottish Oils, Limited, from the business carried on by them or their shareholding companies.

(b) To afford the employers an equal opportunity to demonstrate the negative of (a).

(c) To report whether any external assistance is required to allow of the present rates of wages to the workers being maintained.

On 21st December the parties made a further agreement, under which the immediate reduction (pending the decision of the Court) was to be 5 instead of 10 per cent., which percentage was to be returned if the decision was in favour of the workers. This enabled the companies to restart the main body of workers, other than preparatory workers, who otherwise could not have resumed until the issue of the report.

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