Code of fair competition for the industrial supplies and distributors' trade as approved on October 23, 1933 by Presiden...


Material Information

Code of fair competition for the industrial supplies and distributors' trade as approved on October 23, 1933 by President Roosevelt
Portion of title:
Industrial supplies and distributors' trade
Physical Description:
v, 7 p. : ; 24 cm.
United States -- National Recovery Administration
United States Government Printing Office
Place of Publication:
Washington, D.C
Publication Date:


Subjects / Keywords:
Distributors (Commerce) -- Law and legislation -- United States   ( lcsh )
Industries -- Equipment and supplies -- United States   ( lcsh )
federal government publication   ( marcgt )
non-fiction   ( marcgt )


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Also available in electronic format.
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Cover title.
General Note:
At head of title: National Recovery Administration.
General Note:
General Note:
"Registry No. 1399-1-16."

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University of Florida
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aleph - 004936633
oclc - 647964000
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Full Text







For enle by the Superintendent of Documents, Washington, D.C. - Price 5 center


,Registry No. 1399--1--18

active Order

S2. .etter of Transmittal


This publication is for sale by the Superintendent of Documents, Government
Printing Office, Washington, D.O., and by district offices of the Bureau of Foreign
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An application having been duly made, pursuant to andX in full
compliance with the provisions of Title I of the National Industrial
Recovery Act, approved June 16, 1933, for my approval of a Code
of Fair Competition for the Industrial Supplies and Mlachinery
Distributors' Trade, and hearings having been held thereon and the
Administrator having rendered his report containing an anasisr of
the said Code of Fair Competition, together with his recommenda-
tions and findings with respect thereto, and the Administrator havi
ing found that the said Code of Fair C~ompetition complies in all
respects with the pertinent provisions of Title I of said Act aind that
the requirements of clauses (1) and (2) of subsection (a) of Section
3 of the said Act have been met:
NOW THEREFORE, I, Frankrlin D. Roosevelt, President of thve
United g states, pursuant to the authority vested in me by Title I: of
the National Industrial Recovery Act, approved June 16, 1933, and
otherwise, do adopt and approve the report, recommendation, n
findings; of the Administrator and do order that the said Codeof
Fair Competition be and is hereby approved.
October 23, 1933.
Approval recommended :
A dministrato~r.


The RESIENTOcTOBER 12, 1933.
The Whiite Houlse.
SIR: This is a report of the hearing on the Code of Fair Competi-
tion for the Industrial Supphies and Mlachinery Distributors' Trade
in the United States, conducted in W~ashington on September 271,
1983, in accordance with the provisions of the National Industrial
Recovery Act.

A maximum work week of 40 hours and not to exceed more than
8 hours per day is adopted under this Code with provision for 48
hours' maximum during three weeks of any six months' period to be
averaged down to 40 hours per week.
Executives receiving more than $35.00 per week, watchmen, and
outside salesmen are excepted from t~he schedule of minimum hours
while service employees, those engaged in plant maintenance,ad
stock-room employees may work a maximum of 48 hours with pay-
ment of time and one third for all hours worked in excess of 40
hou rs.
No person under 16 years of age shall be employed and none under
18 employed in any hazardous occupation.
The minimumn rates of pay shall be $15.00 per week in cities and
trade areas of 500,000 population or more, $14.50 per week in cities
and trade areas of 250,000 to 500,000 population, and $14.00 if the
population is over 2,500 and not more than 250,000. In towns of
not more than 2,500, all wages of such employees shall be increased
by not less than 20%0, provided that' this shall not require wages
in excess of $12.00 per week.
Part-time employees in each area shall receive a minimum hourly
wage in relat.ion to 40 hours and the minimum weekly rate.
Learners and junior employees shall receive not less than $r2.00
per week less than the mimlmum rate and not more than 5%o of the
total number of employees can be so classified.


The 40-hour week stipulated in the Code is a reduction from an
average of more than 48 hours per week, and the trade estimates
that under the provision of the Code the number of employees will
be increased 20 percent.
The minimum wage rates specified represent an increase of from
20or to e 100percnt ove the waes erevaling in the same classifications
befre headotin o te Pesdent's Re-employment Agreement.
The importance of the trade is evidenced by the fact that its mem-
bers normally employ 27,000, have a capital investment of

$172,000,000, and have normal average annual sales of $335,000,000.
This trade distributes machinery and industrial supplies---to rail-
roads, ships, mines, mills, factories, and contractors. It. is nation-
wide, its customers including all users of industrial supplies and
The combination of two sectional divisions of trade under one
Code is extremnely gratifying. Each division will be properly rep-
resented in the work of administration by regional committees, act-
ing under the supervision of the Code Authority. These committees
will not only relieve the Code Authority of local details of adminis-
tration, but are truly representative of the regions from which they
are elected.

The Administrator finds that:
(a) The Code as recommended complies in all respects w~ith the
pertinent provisions of Title I of the Act., including, without limita-
tion, subsection (a) of Section 7 and subsection (b) of Section 10
thereof ; and that
(b) he aplicnt goupimposes no inequitable restrictions on
admissio tolian mmbeshptherein and is truly representative of the
Industrial Supplies and MSachinery Distributors Trade; and that
(c) The Code~ as recommended is not designated to promote
monopolies or to eliminate or oppress small enterprises and will not
operate to discriminate against them and will tend to effectuate the
policy of Title I of the National Industrial Recovery Act.
It Is recommended, therefore, that this Code be immediately
Hona S. JoaNsoN,
Ad ministrator.




To effectuate the policies of Title I of the Nrat~ional Industrial
Recovery Act, the followirw provisions are submitted as a Code of
Fair Compet~ition for the industrial Supplies and M~achinery Dis-
tributors' Trade, and upon approval by the President, shall be the
standard of fair competition for this trade.

SECTION 1. The term Industrial Supplies and Machinery Dis-
tributors' Trade ", or trade ", as used herein, includes the ware-
housing, selling, distributing, and/,or servicing in conjunction there-
with of tools, equipment, and supplies for railroads, ships, boat,
mines, mills, factories, and /or other industrial users.
SEc. 2. A Distributor of Industrial Supplies and Mlachinery shall
be defined as one who sells to industrial consumers and other trade
outlets; and who has at least the following facilities and services:
(a) An adequate investment,
(b) Storage space sufficient to carry the stock required in Para-
graph (e) herein and necessary facilities for operating same,
d) Regularly maintains salesmen in his territory to demonstrate
ansell t~he lines handled,
(e) Carries a sufficiently complete purchased stock of industrial
tools, equipment, and supplies to meet normal requirements in, hisi
(f) Aissumes the credit risk: of his sales.
Nothing in this Section 2, Article II, however, shall be construed
to exclude in any way as a member of the trade andf/or from the
operation of this Code, anyone who sells tools, equipment, and sup-
plies to the ind-ustrial users described in Section 1, ALrticle II hereof
except with the approval of such exclusion by the Administrator.
SEc. 3. The termn employee as used herein includes any person
engaged in any phase of the trade in any capacity in the nature of
employee, irrespective of the method of payment of his compensation.
SEc. 4. The term "L employer as used herein includes anyone for
whose benefit such an employee is so engaged.
SEc. 5. The term "L member of the trade "' as used herein includes
any employer who shall be subject to this Clode.
SEC. 6. The term "' member of the Code as used herein includes
any member of the trade who shall expressly signify assent to this

SEO. 7. The term effective date as used herein means the tenth
day after this Code-shall have been approved by the President of the
United States.
SEO. 8. The term "L learner as used herein is a person having no
previous experience in the trade, and whose employment as such
shall not exceed 6 months.
SEc. 9. The term "L act as used herein is Title I of the National
Industrial Recovery Act.
SEc. 10. The term "Administrator as used herein is the National
Recovery Administrator.
SEc. 11. Population for the purposes of this Code shall be deter-
mined by reference to the 1930 Federal Census.


On and after effective date of this Code.
SECTION 1. No employee in the Trade, except as hereinafter pro-
vided, shall be employed for more than eight (8) hours in any one
day nor for more than forty (40) hours mn any one week, nor for
more than six (6) days in any one week; provided, however, that
during inventory and other peak periods, such employees may be
permitted to work not more than forty-eight (48si ) hours in nyone
week, or not more than three (3) weeks in any six ()mnh eid
provided, further, that the average shall not be more than forty (40)
hours per week in anyv six (6) months period.
SEo. 2. The limitation of Section 1 of this Article III as to hours
of work shaUl not apply to persons in a managerial, executive, or
supervisory capacity, who now receive more than $35.00 per week, or
to watchmen and outside salesmen.
SEC. 8. The limitation of Section 1 of the Article III as to hours
of work shall not apply to persons engaged in outside delivery serv-
ice, plant maintenance, outside repair, and/or installation service,
nor to persons engaged in stock receiving and shipping service, who
shall be permitted to work not more than forty-eight (48) hours in
any one week, provided time and one third Is paid -for all hours
worked in excess of forty (40) hours per week.
SEc. 4. No person under heage of sixteen (16) years shall be
employed by any member of the Trade, and no person under the
age of eighteen (18) years shall be employed in any hazardous
SEc. 5. The total number of hours which shall be worked b n
employee whether with one or more employers, shall not ece
the maximum as prescribed herein.

On and after effective date of this Code.
SECTION 1. (a) The minimum rates of pay except as prescribed
in Section 2 of this Article 'IV shall be as follows in cities of the
population listed below and their immediate trade areas:
Over 500,000 population not less than $15.00 per week;
250,000 to 500,000 population not less than $14.50 per Iweek;
2,500 to 250,000 population not- less than $14.00 per week.

In towns of less than 2,500 population, all wages of such em*
ployees shall be increased by not less than 2007o, provided that this
shall not require wages in excess of $12.00 per week.
SEO1. 2. No part time or casual employee shall be paid at a rate per
hour less than the minimum rates prescribed in Section 1 of this
Article IV, which minimum rates are based on a forty (40) hour
week, applying to the area in which the employer is located.
SEo. 3. Learners may be paid at t~he rate of $2.00 less per week
than the minimum rates prescribed in Section 1 of this Article IV,
provided that in no case shall the minimlum be less than $12.00 per
SEC. st. Juior emplOy608 between the ages of sixteen (16) and
eighteen (18) years, inclusive, with less than six (6) months' experi-
ence in the trade, may be paid at a rate of $2.00 less per week: th~an
the minimum rates prescribed in Section 1 of this Article IV, pro-
vided that in no case shall the minimum be less than $10.00 per
SEc. 5. Such learners and junior employees mentioned in Se'ctions
3 and 4 of this Article IV employed by any one employer shall not
exceed in number more than five (5) percent of the total number of
employees of such emnploy~er, provided that each employer may have
at least one learner or Jluxor employee.~m~sto tart necs
SFIc. 6. .No mprnloyeec now receiving omestoatareinecs
of the minimum herein prescribed shall have his compensation re-
duced on account of any reduction in the weekly hours of employ-
ment to conform with the requirements of Article III.
SEC. 7. The hourly wage rate or salary of all employees receiving
more than the minimum rate or salary herein prescribed shall be
equitably adjusted, if such adjustments have not already been made.
SEC. 8. .NO distinction in rates shall be made between male and
female employees, where the same class of work is performed, regard-
less of whether compensation is calculated on an hourly, weekly, or
monthly basis.
SEC. 9. NO employee shall be included in one of the classifications
excepted from the provisions of this Code unless the identical func-
tions were identically classified on June 16, 1933.
SEC. 10. No person who has worked as a learner for one member
of the trade for the period of time prescribed under the term
"L learner "? in Article II may thereafter be classified as a learner.
SEc. 11. No employer shall reduce the compensation for employ-
ment now in excess of the minimum wages herein prescribed, not-
withstanding that the hours worked in such employment mzay be
hereby reduced.
SEc. 12. The provisions for a minimum wage in this Code estab-
lish a guaranteed rate of pay per hour or per week of employment,
regardless of whether the employees' compensation is calculated on
an hourly, weekly or monthly basis.

SECTION i. T0 further effectuate the policies of the Act, a Code
Authority is hereby set up to cooperate with the Administrator in
the administration of this Code.

(a) The Code Aut~hority shall consist of eight members of the
Trade (no two of whom shall represent the same member) and one
or more appointees of the Administrator if he so desires. The latter
shall have no vote. The members of the Code Authority shall be
elected by the members of the Trade, each member of the Trade to
have only one vote. Such election shall be by mail ballots, which
ballots shall be sent to all members of the Trade. The Code
Authority shall complete its own organization by election of officers.
(b) Any member of the Trade is eligible for membership in the
Code and there shall be no inequitable restrictions on such memb-
bership.. Any such member may participate in the preparation and
any revision of and additions or supplements to this Code by ac-
c~epting his proper pro rata share of the cost and responsibility of
creating and adminnisterinng it, either by becoming a member of
the.National S9upply andl Machinery Distributors' Association or
the Southern Supply M~achine Distributors' Association or by pay-
ing to the Code Authority his pro rata share of the costs, based on
the dollar volume of sales by the entire trade. There shall be no
initiation fee for members of the Trade who participate only in
the Code and do not become members of one of the said Associations.
8Ec. 2. The Code Authority shall have the following duties and
powers to the extent permlitted by the Act and subject to review
by the Administrator:
(a) To collect from persons in the Trade all data, reports, and
statistics when and as required by the President and/or the Admin-
istrator and/or their agent or agents. Such information shall be
confidential. Each member shall send his data to a neutral agency
designated by the Code Authorit~y. This neutral agency shall as-
semble all such data and present it to t~he Code Autuhority without
the names of the members of the Trade submitting such data. This
data with names shall be available to the Administrator, if required
by hiim. Reports submitted by the Code Authority to the President
and/or the Admiinistrator and/lor his or their agent or agents shall
be in the form prescribed and/or approved by him. Nothing in this
paragraph shall be construed as Ilunit~ing the powers conferred on
the President and~/or the Administrator by Title I of the Aot.
(b) In addition to information required to be submitted to the
Code Authority,~ there shall be furnished to Government agencies
such statistical Information as the Administrator may deem neces-
sary for the purpose recited in Section 3 (a) of the National
Industrial Recovery Act.
(c) To represent the Trade in conferring with the President or
hiis agents with respect to the administration of this Code and in
respect of the Act and any regulations issued thereunder.
(d) To arrange for a Regional Committee in each territorial area
to assist. the Code Authority in administering the code. Each such
Regional Committee shall consist of not more than three (3) mem-
bers of the trade in such area, elected by the members of the trade in
such area.
(e) To appoint such agents as it may deem necessary to assist in
administering this code.
(f) To hear and investigate complaints and attempt to adjust
the same in accordance with law.

(g) To study the trade-practice provisions of Article VI and the
operation thereof, and make such recommendation from time to time
to the Administrator as it deems desirable for modification of or
addition thereto, which, upon the approval of the President., after
such hearing as he may prescribe, shall become a part of this Cfode
and have full force and effect as provisions hereof.
(h) To make rules and regulations necessary for the administra-
tion of this Code, subject to the approval of the Administrator.
(i) To report to t~he Admninistrator on behalf of the trade on the
subject of imported articles competing with products distributed
by the trade under provisions of Section 3 (a) of the Adt.

The following practices are hereby declared to be unfair methods
of competition within the meaning of the Act:
SECTION 1. Sales below the individual's cost. Cost is to be deter-
mined by a standard cost-accounting system to be set up by the Code
Authority and subject to the approval of the Administrator. It is
expressly understood that this shall not apply to items on which the
published or suggested prices of manufacturers do not provide a
margmn sufficient to cover the individual's cost as determined by the
above-mentioned standard cost-accounting; system.
SEc. 2. Where in any particular territory, members of the Trade
desire to file price lists with such agency as may be approved by the
Code Authority, it is a violation of the Code for such members to
sell below their individually filed schedules covering prices, term,
and conditions. Such schedules are to be subject to change at any
time. by filing a new schedule, which shall be effective five (5) days
after filing.
SEC. 3. The payment or allowance of secret rebates, refunds, dis-
counts, cormmissions, or other special considerations or allowancesx, in-
cluding donations, gifts, or premiums of any nature whatsoever, to
any firm or individual.
SEC. 4. The issuance of false invoices or other documents covering
sales in which the prices, terms, discounts, allowances, or other facts
relating to the transaction are in any manner falsely stated.
SECI. 5. Discrimination in prices between purchasers of the same
class under similar conditions except for differences in the grade,
quality, or quantity purchased.
SEc. 6. Delivering merchandise which fails to conform exactly to
the samples or specifications on which prices are quoted.
SEc. 7. Agreeing to conditions or terms of sale, or making prom-
ises of any, nature which manifestly cannot be fulfilled.
SEC. 8. Accepting orders for future delivery subject to cancellation.
SEc. 9. Inducing or attempting to induce the cancellation of orders
or the breach of contracts existing between competitors and their
SEc. 10. Misrepresentation of facts about a competitor or his prod-
SEc. 11. Quoting a total price on any schedule of industrial sulp-
plies and machinery which does not show unit prices and making any
addition or deduction on any other basis than the unit price shown.

SEC. 12. it is RI1 HI16conomical and an unfair practice for distribu-
tors to ship any goods on consignment, except productsJ of manufac-
turers whose general plan of distribution is by consignment and not
by sale for resale.

In the absence of any contrary provision herein concerning such
trade practice, each member of the trade shall in dealing with a
product manufactured by a member of a.n industry operating under
another Code of Fair Competition, conduct such dealing in con-
formity with any pertinent trade-practice provisions in such other

SECTION 1. Employees shall have the right to organize and bargain
collectively through representatives of their own choosing and shall
be free from the Interference, restraint, or coercion of employers of
labor, or their agents, in the designation of such representatives or
in self-or~ganization or in other concerted activities for the purpose
of collective bargaining or other mutual aid or protection;
SEC. 2. NO employee and no one seeking employment shall be re-
quired as a condition of employment to join any company union or to
reframn from joining, organizing, or assistmng a labor organization
of his own choosing; and
SEO. 3. Employers shall comply with the maximum hours of labor,
minimum rates of pay, and other conditions of employment atpprovedi
or prescribed by the President.
SEC. 4. This Code and all the provisions thereof are expressly
made subject to the right of the President, in accordance with the
provision of subsection (b) of Section 10 of the National Industrial
Recovery Act, from time to time to cancel or modify any order
approval license, rule, or regulation issued under Title I of said
Act, and specifically, but without limitation, to the right of the Presi-
dent to cancel or modify his approval of this Code or any conditions~
imposed by him upon his approval thereof.
SEc. 5. WVit~hin each State, members of the trade shall comply with
any laws of sucrh Sta~te imposing more stringent requirements regulat-
ing the age of employees, wages, hours of work, or health, fire, or
general working conchtions, than under this Code.
.SEC. 6. If any employer in this trade is also an employer in any
other trade or industry the provisions of this Code shall apply and
affect only that part of the business of such employer which is a
part of t~he trade covered by this Code.
SEC. 7. Where the costs of executing contracts entered into this
trade are increased as a result of the enactment of the National In-
dustrial Recovery Act and/or by t~he provisions of this Code, or
where any contract entered into by an empolyer subject to this Code,
is iconistnt wth he rovisions thereof, it is equitable and pro-
moive iofithen puposhes o~f the Act that appropriate adjustments of
such contracts be arrived at by arbitral proceedings or otherwise, and
the Codle Authority is constituted an agency to assist, with the con-
sent of the buyer in effecting such adjustments. Further, that where

the performance of orders accepted prior to the effective date of this
Code is delayed or prolonged as a result of the operation of provisions
of this Code, appropriate additional time should be allowed for the
completion of such orders.
SEc. 8. Such of the provisions of this Code as are not required to
be included therein by the National Industrial Recoveryr Act may,
with the approval of the President, be mlodified or eliminated as
changes in the circumstances or experience may indicate.. It is conl-
temlplatedi that from time to time supplementary provisions to this
Cade or additional codes will be submitted for the approval of the
President to prevent unfair competition in price and other unfair
and destructive competitive practices, and to effectuate the other
purposes and policies of Title I of the National Industrial Recovery
Act consistent with the provisions thereof.
SEC. 9, PTIOr to December 31, 1933, no member of the trade shall
increase the sale price of his goods sold after the effective date
hereof over the price on July 1, 1933, by more than is made necessary
by actual increases in manuf acturing, distribution, and material
costs, or by taxes or other costs resulting from action taken pursuant
to the Agricultural Adjustment Act and 'or this Code since July 1,
1933, and in setting such price increases full weight shall be given
to probable increases in sales volume. In case a member of the trade
on July 1, 1933, was selling his product at less than actual cost,
he may take his cost price on that date as the base for such increase
in selling price as is permitted by this section.
SEc. 10. No provision in this Code shall be interpreted or applied
in such manner as to--

SPermiit or encourage unfair competition;
SElimiinate or oppress small enterprises; or
d) Discriminate against small enterprises.
This Codce shasll ber in effect, beginning on the tenth day after its
approval by the President and shall be binding upon all persons
engaged in the trade.


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