Beneficiary Features of American Trade Unions — Background and Themes

CHAPTER I. Insurance Against Death and Disability CHAPTER II. Death Benefits CHAPTER III. Sick Benefits CHAPTER IV. Out-of-Work Benefits CHAPTER V. Superannuation Benefits CHAPTER VI. Administration

This monograph had its origin in the investigations of American trade-union activities which have engaged the attention of the Economic Seminary of the Johns Hopkins University since October, 1902. It was begun and completed while the author was a graduate student at the University.

The study is based on a survey of the beneficiary activities of national and international trade unions. While no attempt has been made to study in detail the various forms of mutual insurance maintained by local trade unions, frequent references are made thereto, inasmuch as the local activities have usually an important genetic connection with the national. The sources from which information has been secured are the trade-union publications in the Johns Hopkins University collection and important documents at the headquarters of different unions. These have been supplemented by personal interviews with prominent officials and labor leaders.

The author wishes to acknowledge the assistance received, at every stage of the work, from Professor Jacob H. Hollander and Associate Professor George E. Barnett of the Department of Political Economy of the Johns Hopkins University.

BENEFICIARY FEATURES OF AMERICAN TRADE UNIONS.

The American trade unions have developed beneficiary functions far more slowly than the trade unions of England and Germany. Only since about 1880 has there been any considerable increase in such activities. Prior to that time the national unions with few exceptions paid no benefits.[1] The local unions, here and there, developed beneficiary systems, but these were not continuous nor, in many cases, important.

[Footnote 1: The term "benefit" is used in this monograph to include all forms of mutual insurance other than those directly connected with the enforcement of trade-union rules by collective bargaining. "Strike benefits" and "victimized benefits" are thus without the scope of the study.]

The history of trade-union beneficiary activities in the United States may be roughly divided into three periods. In the first, extending from the beginning of the century to about 1830, the local associations laid great stress on their beneficiary functions. The societies of printers organized from 1794 to 1815 in the most important American cities were typical of the period. In all of them, as far as the extant records show, the beneficiary functions were regarded as equally important with the trade-regulating activities. American trade unionism owed its origin as much to the desire to associate for mutual insurance as to the desire to establish trade rules.

The second period, from 1830 to 1880, was marked by the subordination of beneficiary to trade purposes. The maintenance of a minimum rate and other trade policies came to occupy the foremost place in the program of the local unions. In this period national unions were formed in many trades.

The new national unions were not strong enough to establish beneficiary systems. Moreover, at many points the establishment of local benefits conflicted with the success of the national organizations. A local union was usually forced to impose certain restrictions upon claimants of benefits, either an initiation fee or a requisite term of membership, in order to protect its funds. Such limitations on the full participation of all members in the benefits of membership militated severely against the carrying out of the prime function of the national unions--the nationalization of membership. The leaders in the trade-union movement of this period were interested chiefly in strengthening the relations of the local unions. They saw, therefore, in the local benefits a hindrance to the accomplishment of their aims. By 1860 it had become a fairly well accepted doctrine that a trade union should not attempt to develop beneficiary functions. It was argued that since the expense of maintaining benefits made the dues of members higher, persons who might otherwise join the unions were prevented from doing so. The leaders of the Iron Molders for years opposed the introduction of beneficiary features on the ground that the development of such activities was likely to interfere with the trade functions of the organization. In 1866 President Sylvis for this reason vigorously opposed the introduction of a national sick benefit.[2] As late as 1895 the veteran president of the Iron Molders--Mr. Martin Fox--counselled the Union against developing an extensive beneficiary system.[3] The same views were entertained by the leaders of the other more important unions of the period.

[Footnote 2: Iron Molders' Journal, Vol. I, p. 309.]

[Footnote 3: Proceedings of the Twentieth Session, 1895, Report of the President.]