Beneficiary Features of American Trade Unions Part 11

CHAPTER V.

SUPERANNUATION BENEFITS.

In 1901 thirty-eight of the one hundred princ.i.p.al British unions paid a superannuation benefit. These unions had a members.h.i.+p of 566,765, and the amount paid in superannuation benefits from 1892 to 1901 was about one sixth of the total amount expended for all benefits.[199] In the American trade unions, on the other hand, superannuation benefits are paid by only a few unions. A considerable number of unions have in recent years been considering the advisability of introducing this feature, and it is likely within a brief period to form an important part of the beneficiary system of the American unions.

[Footnote 199: Weyl, "Benefit Features of British Trade Unions," in Bulletin of the Bureau of Labor, Vol. 12, p. 722.]

The superannuation benefit may take several forms--a weekly stipend, a lump sum or a support in a home for the aged. The aim of the benefit in all three cases is to protect the member in old age. The weekly stipend is regarded as the preferable form, since in going to a home the member must leave his family. Ordinarily, too, a weekly payment is deemed wiser than a lump sum, since the aged member cannot very well manage property, and the chances are that he will lose his capital. The British trade unions uniformly pay the benefit in the form of a weekly or monthly pension.

The earliest attempt made by any American trade union to make provision for the support of aged members was that of the Typographical Union in 1857. The National Convention of that year appointed a committee to consider the proposal of the Philadelphia printers for the establishment of an "Asylum for Superannuated and Indigent Printers." This plan was defeated at the ninth convention in 1860.[200] The Iron Molders' Union as early as 1874 provided for the establishment of a "superannuated fund," from which superannuated members of twenty years' standing were to receive three hundred dollars and those of twenty-five years' four hundred, if permanently disabled and unable to earn a living at their trade. Members.h.i.+p was to date from July 5, 1859, and no benefit was to be paid until August, 1879.[201] Because of the failure to acc.u.mulate sufficient reserve for its support, the regulations were repealed in 1878 before any benefit fell due.[202] The superannuation benefit adopted by the Granite Cutters early in their history met a similar fate.

[Footnote 200: Proceedings of the Seventh Convention, Chicago, 1858 (New York, 1858), p. 11; Proceedings of the Ninth Convention, Nashville, 1860 (Boston, 1860), pp. 53-54.]

[Footnote 201: Const.i.tution, 1876 (Cincinnati, 1876), Art. 18.]

[Footnote 202: Const.i.tution, 1878 (Cincinnati, 1878), Art. 17; Iron Molders' Journal, August, 1878, p. 4; October, 1878, p. 30.]

In recent years agitation for the establishment of some form of superannuation benefit has been carried forward in several of the more important unions. In 1893 Mr. Gompers proposed the establishment of this form of beneficiary relief in the Cigar Makers' Union. In June, 1904, a plan was discussed for the payment of a monthly benefit of six dollars to members sixty years of age and twenty-five years in good standing.

Larger benefits were to be paid to members older and of longer standing.

Up to the present, however, the Cigar Makers have not adopted any of the plans for a superannuation benefit. The Brotherhood of Carpenters and Joiners, at the 1900 convention, provided for the payment to members of twenty-five years' continuous members.h.i.+p and over sixty years of age such amount as the National Convention might designate.[203] In 1902 it was decided that if the members by referendum vote endorsed an increase of dues, the amount of this benefit should be fixed at $150.[204] But the increase of dues failed of ratification, and the plan for a superannuation benefit was abandoned.

[Footnote 203: Proceedings of the Eleventh General Convention of the Brotherhood of Carpenters and Joiners, Scranton, 1900 (Scranton, 1900).

p. 67.]

[Footnote 204: Proceedings of the Twelfth General Convention, 1902 (Atlanta, 1902), pp. 123, 163; The Carpenter, Vol. 22, November, 1902, p. 3; Vol. 23, No. 1.]

A few unions have allowed aged members to draw all or a part of their death benefit. Thus, the Granite Cutters permit members sixty years of age who have been in continuous good standing for ten years to draw the sum of $125.[205] The Typographia also pays an indeterminate lump sum to aged members who wish to retire from the trade.

[Footnote 205: Const.i.tution, 1905 (Boston, n.d.), p. 28.]

More important still, a considerable number of unions have made provision for the payment of a superannuation benefit in one form or another at a definite future date. Such unions are the Journeymen Plumbers, the Pattern Makers, the Machinists and the Jewelry Workers.

In the Plumbers' a.s.sociation any member of at least twenty years' full members.h.i.+p and not less than forty-five years of age, who, through old age or infirmity, is incapacitated from following his employment, is ent.i.tled to the benefit according to a prescribed scale; those of twenty consecutive years' full members.h.i.+p and not under sixty-five years of age are to receive three hundred dollars; those of twenty-five years'

members.h.i.+p and not under seventy years of age, four hundred dollars; those of thirty years' members.h.i.+p and over, five hundred dollars. The rule providing for the payment of the benefit became effective in January, 1903, but no benefit is to be paid before January, 1923.[206]

The Pattern Makers' League provides that superannuated members be divided into two cla.s.ses: (_a_) members sixty years of age and of twenty-five years' continuous members.h.i.+p, who receive twelve dollars per month, and (_b_) those sixty-five years of age and over and of thirty years' members.h.i.+p, who receive sixteen dollars per month. The provisions of this rule became operative July 1, 1900, and the first benefit will be payable on July 1, 1920.[207] The Jewelry Workers have the same specifications as the Pattern Makers. The rule went into effect January 1, 1902, but no benefit will be paid until January 1, 1922.[208] The Machinists provide that any member sixty-five years of age and of ten consecutive years' good standing shall receive five hundred dollars and those sixty-eight years of age and of twenty years' standing shall receive one thousand dollars. This benefit became effective June 1, 1903, and no payment can be made before June 1, 1913.

[Footnote 206: Const.i.tution, 1904 (Chicago, n.d.), pp. 52-53.]

[Footnote 207: Const.i.tution, 1906 (New York, n.d.), pp. 15-16.]

[Footnote 208: Const.i.tution, 1902, Art. 11.]

The only two American trade unions which in 1908 are actually paying a superannuation benefit as distinguished from a mere compounding of the death benefit are the Granite Cutters and the Typographical Union. In both the establishment of the benefit is very recent.

In 1905 the Granite Cutters made provision for the payment of a monthly benefit of ten dollars for "six months each year beginning with November" to those who had been members for twenty years and who had reached the age of sixty-two. The applicants must have been in continuous good standing for the "last ten years previous to arriving at the age of sixty-two."[209] The first payments under the new rule were made in December, 1905.

[Footnote 209: Const.i.tution, 1905 (Quincy, n.d.), p. 45.]

The Typographical Union has, however, led all the American trade unions in the provision which it has made for its aged members. As has been noted above, as early as 1857 it was proposed to establish a home for aged printers in Philadelphia, and the project was revived from time to time. The persistence with which this proposal appeared and reappeared gave evidence of its popularity. In 1870 a Kansas union proposed the establishment of a "Home for Disabled Printers." All members of local unions were to be taxed two dollars each for the purpose of endowing the Home. The committee of the International Union to whom the plan was referred reported that they "deemed it impracticable at the present time." In 1877 a similar proposal was defeated. In 1882 a committee consisting of the officers of the union was appointed to inquire into the possibility of establis.h.i.+ng and maintaining a "Home for Disabled Printers." This committee expressed its approval of the project, but doubted the ability of the union to finance it.

In 1886 Messrs. George W. Childs and A.J. Drexel of Philadelphia presented to the International Union the sum of ten thousand dollars.

This donation was to be used in any manner the union might see fit. For some years an active discussion as to the best use to be made of the fund was carried on, and in the meantime the sum was being increased by contributions from members of the union.

It ultimately became evident that some plan for applying this fund to the establishment of a home for aged printers would best satisfy the members.h.i.+p. In 1887 the Austin, Texas, union announced that the Mayor and City Council of Austin were willing to present a site for such a home. In 1889 the Board of Trade of Colorado Springs offered to donate eighty acres of land for the same purpose, and other offers of land were received from time to time. The International Union finally decided to accept the offer of the site at Colorado Springs, and this decision was approved by a referendum vote.

The Home was opened on May 12, 1892. Applicants for admission were required to have been members of the union in good standing for five years. Persons incapacitated either by age or by illness were admitted to the Home. The number of residents has increased from twenty-two in 1893 to one hundred and forty-three in 1907. A considerable part of the residents are sufferers from tuberculosis, and the union has made provision for treating them according to modern methods. A part of the inmates, however, have always been persons whose incapacity was solely the result of old age.

About 1904 an agitation began to be carried on in the union for making more adequate provision for the maintenance of aged members. The establishment of the Home had made provision only for those incapacitated members who were willing to leave their families and live in an inst.i.tution. It was argued that the Home benefited one cla.s.s of the aged, and that another cla.s.s, equally worthy, was left entirely dependent upon its own resources. Moreover, certain innovations in the trade had made the union highly sensible of the helplessness of its aged members. The introduction of the linotype caused many old members to lose their employment. The New York local union established an out-of-work benefit in 1896 which has since been maintained. This benefit, while nominally an out-of-work benefit, was in many cases really a superannuation benefit. In 1903 the Chicago local union made provision for the payment of old-age pensions to its members, and other local unions rapidly followed the same policy.

In 1903 and 1904 propositions were introduced at the sessions of the International Union for the establishment of an International old-age pension system. In 1905 the session of the International authorized the appointment of a committee to investigate the subject. The eight-hour strike which taxed for two years the resources of the Union delayed the consideration of this report. In 1907 the committee reported in favor of the establishment of old age pensions, and presented a plan which when submitted to the referendum was ratified by a large majority, and on August 1, 1908, the International secretary-treasurer began the payment of pensions. All members sixty years of age who have been in continuous good standing for twenty years, and who earn less than four dollars per week, are ent.i.tled to a weekly pension of four dollars. The original plan provided also that in order to receive a pension a member must have no other means of support. The officers of the Union, however, have construed this provision liberally, and the pension is paid as of right and not as a form of charity.

The pension scheme thus adopted by the Typographical Union is the most ambitious that has been proposed in any American trade union. The sum of money required to finance the project will be very large, and the Union has levied for the support of the pension system an a.s.sessment of one half of one per cent. on the wages of all its members. Whether this will be sufficient adequately to support the benefit is as yet uncertain, since the number of pensioners cannot be estimated with any accuracy. It is certain also that the number of pensioners will not reach its maximum for a considerable period.

CHAPTER VI.

ADMINISTRATION.

No factor has been of more consequence in determining the development and stability of the relief systems than the character of their administration. The problems that confront the unions are both legislative and administrative, but the administrative organs must not only execute the rules already in force, but must furnish data upon which additional rules can be based.

When the early voluntary insurance a.s.sociations were formed under the auspices of the national unions, their management was usually confided to a separate set of officials, and the funds of the a.s.sociation were kept distinct from those of the unions with which they were connected.

In some cases the officers of the unions, for purposes of economy, acted also as officers of the a.s.sociation. The Iron Molders' Beneficial a.s.sociation was thus formed as a separate inst.i.tution to furnish a voluntary death and disability benefit to any journeyman molder in good standing in any local union under the jurisdiction of the national organization.[210]

[Footnote 210: Iron Molders' Journal, Vol. 7, March, 1871.]

The administration of the beneficiary systems, in all but two of the unions, is now carried on by the officers who manage the general affairs of the union. The Brotherhood of Locomotive Engineers and the National a.s.sociation of Letter Carriers each maintains a mutual benefit department administered by separate officers. The official staff of the Engineers' Insurance a.s.sociation consists of a president, a vice-president, a secretary-treasurer and five trustees; while that of the Letter Carriers consists of the president of the National a.s.sociation, a board of trustees, a chief collector and a depositary.

In those unions in which the administration of the beneficiary system is in the hands of the officials of the union the officials in charge of the administration of the benefits are usually two, variously known as a grand chief, grand master or president and a secretary-treasurer. In a few unions the offices of treasurer and secretary are separated. In the Cigar Makers the president also performs the duty of secretary. In the Tailors the general secretary has sole charge of the benefits. In the Iron Molders' Union the "financier" has charge of the administration of the sick benefits.

The secretary-treasurer in the majority of the unions is the chief official concerned in administering the benefits. Such is the case in the Typographical Union, the Brotherhood of Painters, the United a.s.sociation of Plumbers, the Boot and Shoe Workers' Union, the Tobacco Workers' Union, the Brotherhood of Leather Workers on Horse Goods, and the Barbers' International Union.[211] In the Iron Molders' Union, the Brotherhood of Carpenters, the Wood Workers' Union, the Gla.s.s Bottle Blowers' a.s.sociation, the United Garment Workers' Union, and the Granite Cutters' Union these duties are divided between the general secretary and the general treasurer.

[Footnote 211: Typographical Union, Const.i.tution, 1904 (Indianapolis, n.d.), p. 26; Plumbers' Const.i.tution, 1904 (Chicago, n.d.), pp. 19-21; Painters' Const.i.tution, 1904 (La Fayette, n.d.), secs. 230-241; Boot and Shoe Workers' Const.i.tution, 1904 (Boston, n.d.), sec. 7; Tobacco Workers' Const.i.tution, 1900, third edition, 1905 (Louisville, n.d.), pp.

10-15; Leather Workers on Horse Goods, Const.i.tution, 1904 (Kansas City, n.d.), p. 7; Barbers' Const.i.tution, 1905 (Indianapolis, n.d.), pp.

13-14.]

Ordinarily no particular part of the funds of the union is devoted to the payment of beneficiary claims. The unions paying insurance, however, are exceptional in this respect. In such cases the funds of the insurance departments are separate from the general funds of the brotherhoods, and the dues for maintaining the insurance departments are levied as a.s.sessments distinct from the general levies. Nearly all the grand lodges have made provision in their const.i.tutions against encroachments upon the beneficiary funds by the grand officers for the benefit of other departments. The Trainmen and the Switchmen provide that the beneficiary fund shall be used exclusively in paying death and disability claims.[212] The Telegraphers provide that no part of the mortuary fund shall be paid out, loaned or diverted for any purpose except for the payment of approved death claims.[213] The Firemen pay out of their beneficiary fund "all expenses for the proper conducting of the beneficiary departments."[214] The position of the Conductors on this point is not so explicit. The Order, however, holds in reserve a fund of $300,000, from which the grand officers may draw, in case the a.s.sessments levied for beneficiary purposes are insufficient to pay legal claims and the surplus in the beneficiary fund is not sufficient to cover the deficit.[215] The Engineers and the Maintenance-of-Way Employees have no specific regulation of this kind; but the implication is that similar protection is furnished their funds. The Letter Carriers provide that the beneficiary fund shall be used exclusively for paying insurance claims.

[Footnote 212: Const.i.tution of the Railroad Trainmen, 1903 (Cleveland, 1903), sec. 58; Const.i.tution of the Switchmen's Union of North America.

1903 (Buffalo, n.d.), sec. 57.]

[Footnote 213: Const.i.tution, 1903 (St. Louis, n.d.), Article 23, p.

109.]

[Footnote 214: Const.i.tution, amended, 1902 (Peoria, n.d.), sec. 52.]