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Approved Code No. 139
Registry No. 1149-12
NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
MACHINE TOOL AND EQUIPMENT
AS APPROVED ON NOVEMBER 27, 1933
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Foreign and Domestic Commerce.
DISTRICT OFFICES OF THE DEPARTMENT OF COMMERCE
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Birmingham, Ala.: 257 Federal Building.
Boston, Mass.: 1801 Customhouse.
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Chicago, Ill.: Suite 1706, 201 North Wells Street
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Detroit, Mich.: 2213 First National Bank Building.
Houston, Tex.: Chamber of Commerce Building.
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Minneapolis, Minn.: 213 Federal Building.
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Norfolk, Va.: 406 East Plume Street.
Philadelphia. Pa.: 933 Commercial Trust Building.
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St. Louis, Mo.: 506 Olive Street.
San Francisco, Calif.: 310 Customhouse.
Seattle, Wash.: 809 Federal Building.
Approved Code No. 139
CODE OF FAIR COMPETITION
MACHINE TOOL AND EQUIPMENT DISTRIBUTING
As Approved on November 27, 1933
An application having been duly made, pursuant to and 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 Machine Tool and Equipment Distribut-
ing Trade, and hearings having-been held theredn and the Adminis-
trator having rendered his report containing an analysis of the said
code of fair competition together with his recommendations and
findings with respect thereto, and the Administrator having found
that the said code of fair competition complies in all respects with
the pertinent provisions of title I of said act and that the require-
ments of clauses (1) and (2) of subsection (a) of section 3 of the
said act have been met:
NOW, THEREFORE, I, Franklin D. Roosevelt, President of the
United 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 and recommendations,
and findings of the Administrator and do order that the said code of
fair competition be and it is hereby approved.
FRANKLIN D. ROOSEVELT.
HUGH S. JOHNSON,
THE WHITE HOUSE,
November 7, 1933.
NOVEMBER 21, 1983.
The White House.
SIR: This is a report on the Code of Fair Competition for the
Machine Tool and Equipment Distributing Trade, the hearing hav-
ing been held in Washington, October 27, 1933, in accordance with
the provisions of the National Industrial Recovery Act.
PROVISIONS ON HOURS AND WAGES
Employees in the Trade are limited to a working day of 8 hours,
with 40 hours as a maximum work week. At inventory and other
peak periods employees may work 48 hours per week for not more
than 3 weeks in any six months' period, but the average shall not be
more than 40 hours per week in such six months' period. These
hours conform closely to the hours of the industries which are served
by this Trade.
The above limitations do not apply to persons in a managerial,
executive, or supervisory position regularly receiving more than
$35.00 per week, nor to outside salesmen. Employees engaged in
plant maintenance or as stock-room employees will receive time and
one third for all hours over 8 per day or 40 per week.
The majority of employees in the Trade are engaged in clerical
work and as outside salesmen. Their minimum rates of pay will be
not less than $15.00 per week in cities of over 500,000 population,
$14.50 per week in cities of from 250,000 to 500,000 population, and
$14.00 per week in cities of less than 250,000 population. Junior
employees will receive $2.00 less per week than these rates for the
first six months of their employment.
No person under 16 years of age will be employed in the Trade,
and no one under 18 will be engaged in any hazardous occupation.
ECONOMIC EFFECT OF THE CODE
This Trade distributes machine tools and equipment, the basic
tools of industry. All resales are made on a commission basis, and
sales are usually based on engineering studies. While small in the
number of employees, it is important from the standpoint of being a
This Trade is not only subject to the usual fluctuations which take
place in the capital goods industries, but, in addition, has suffered
from the depression because of the stoppage of buying of basic tools
by other industries. But because of the progress of invention in this
class of equipment during the period of stagnation, a rapid recovery
in buying is expected when general manufacturing plants increase
A total of 1,800 employees were engaged in the Trade in 1929, but
this total has dropped to approximately 800 at the beginning of
1933. The sales volume for the year 1929 was approximately $135,-
000,000 but this had declined until the sales during the first six
months of 1933 were at a rate only 10 percent of normal. The reten-
tion of 40 percent of the normal number of employees with only 10
percent of the volume of business has indicated a liberal sharing of
employment. The cut in normal working hours from an average of
more than 50 to the maximum of 40 prescribed in this Code should
mean an immediate rapid rise in employment with increased sales
The Administrator finds that:
(a) The Code as recommended complies in all respects with 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) The applicant group imposes no inequitable restrictions on
admission to membership therein and is truly representative of the
Machine Tool and Equipment Distributing Trade; and that
(c) The Code as recommended is not designed to promote monop-
olies 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 approved.
HUGH S. JOHNSON,
CODE OF FAIR COMPETITION
MACHINE TOOL AND EQUIPMENT DISTRIBUTING
To effectuate the policies of Title I of the National Industrial
Recovery Act, the following provisions are submitted as a Code of
Fair Competition for the Machine Tool and Equipment Distribut-
ing Trade, and, upon approval by the President, shall be the stand-
ard of Fair Competition for this Trade, and shall be binding upon
every member thereof.
SECTION 1. The term "Act" as used herein means Title I of the
National Industrial Recovery Act.
SEC. 2. The term "Administrator as used herein means the Ad-
ministrator of the Act.
SEC. 3. The term "Association" as used herein means the Asso.
ciated Machine Tool Dealers.
SEC. 4. The term "Machine Tool and Equipment Distributing
Trade" as used herein includes for resale the warehousing, selling,
and distribution of new machine tools and attachments, equipment
and parts thereof, including such jigs and fixtures, die heads, and
small tools and accessories as are now, or may hereafter be made
by manufacturers of machine tools for machine tools of their own
SEC. 5. The term "machine tools and equipment" as used herein
means power driven metal working machines which perform gen-
erally the function of changing the form of metal by the use of one
or more cutting tools, abrasives, forming dies, rolls, etc., including
all attachments, parts, jigs and fixtures, die heads, and such small
tools and accessories as are now, or may hereafter be made by manu-
facturers of machine tools for machine tools of their own manu-
SEC. 6. Distributors in the Machine Tool and Equipment Distrib-
uting Trade shall be classified as:
Machine tool dealer" is one who purchases new machine tools
and equipment for resale to industrial users, public service corpora-
tions, educational institutions, government or political subdivisions
and other trade outlets; maintains an adequate selling organization
and accounting system, and performs all other functions pertaining
to the sale and distribution of machine tools and equipment for same.
(b) Manufacturers' agent is one who sells new machine tools
and equipment to industrial users, public service corporations
educational institutions, government or political subdivisions and
other trade outlets for the account of one or more machine tool
(c) "Importer of machine tools" is one who imports machine
tools and equipment for same and sells to industrial users, public
service corporations, educational institutions, government or political
subdivisions and other trade outlets.
SEc. 7. The term "employee" as used herein means anyone
engaged in the Trade in any capacity receiving compensation for
his services, irrespective of the nature or method of payment of
SEC. 8. The term "employer" as used herein means anyone by
whom any employee is compensated or employed.
SEc. 9. The term member of the Trade as used herein includes
machine tool dealers, manufacturers' agents and importers of
machine tools who are engaged in the distribution of new machine
tools and equipment for same.
SEC. 10. The term "member of the Code as used herein includes
any member of the Trade who shall expressly signify assent to this
SEC. 11. The term President means the President of the United
SEC. 12. The term trading areas" as used herein means the
several territories outlined in agreements between machine tool
dealers and machine tool manufacturers.
SEc. 13. Population for the purposes of this Code shall be deter-
mined by reference to the 1930 Federal Census.
SECTION 1. No employee, except as hereinafter provided, shall be
permitted to work in excess of eight (8) hours per day or in excess
of forty (40) hours per week, or in excess of six (6) days in any
one week; provided, however, that during inventory and other peak
periods, any employee may be permitted to work not to exceed
forty-eight (48) hours per week in any three (3) weeks in any six
(6) months period; provided, further, that the average hours worked
by any employee shall not exceed forty (40) hours per week in any
six (6) months' period.
SEC. 2. The limitation of Section 1 of this Article III as to hours
of work shall not apply to employees engaged in a managerial,
executive, or supervisory capacity, who receive more than $35.00 per
week, or to watchmen and outside salesmen.
SEC. 3. The limitation of Section 1 of this Article III as to hours
of work shall not apply to employees engaged in outside delivery
service, plant maintenance, outside repair, and/or installation serv-
ice or to employees engaged in stock receiving and shipping service,
who shall be permitted to work not more than forty-eight (48) hours
per 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 the age 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 by any
employee, whether with one or more employers, shall not exceed the
maximum as prescribed herein.
SECTION 1. (a) The minimum rates of pay except as prescribed in
Section 3 of this Article IV shall be as follows in cities of the popu-
lation listed below and their immediate trade areas: Over 500,000
population not less than $15.00 per week; 250,000 population or over,
ut less than 500,000 population not less than $14.50 per week; under
250,000 population not less than $14.00 per week.
SEc. 2. No part-time employee shall be paid at a rate less than the
minimum rates prescribed in Section 1 of this Article IV.
SEC. 3. Junior employees 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 than
the minimum rates prescribed in Section 1 of this Article IV; pro-
vided, however, that such junior employees shall not exceed in num-
ber five (5) percent of the total number of employees of any one
employer; and provided, further, that each employer may have at
least one junior employee in each district office.
SEc. 4. No employee now receiving compensation at a rate in
excess of the minimum herein prescribed shall have his weekly com-
pensation reduced on account of any reduction in the weekly hours
of employment to conform with the requirements of Article III.
SEc. 5. 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. 6. No distinction in rates shall be made between male and
female employees, where the same class of work is performed, re-
gardless of whether compensation is calculated on an hourly, weekly,
or other basis.
SEC. 7. 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. 8. No person who has worked as a junior employee in the
Trade for the period of time prescribed in Section 3 of this Article
IV may thereafter be classified as a junior employee.
SEC. 9. This Article establishes minimum rates of pay for all
employees regardless of whether the employees' compensation is
calculated on an hourly, weekly, or other basis.
SECTION 1. To effectuate the policies of the Act a Supervisory
Agency is hereby constituted to cooperate with the Administrator in
the administration of this Code.
SEC. 2. During the sixty (60) day period following the effective
date of this Code, the Code Committee of the Associated Machine
Tool Dealers shall constitute a Temporary Supervisory Agency.
This Committee shall consist of five (5) members, and the Adminis-
trator in his discretion, may appoint not more than three (3) addi-
tional members (without vote) to represent the Administrator or
such groups or interests as may be agreed upon.
SEC. 3. To permit representation of members of the Trade, not
members of the Associated Machine Tool Dealers, the latter shall,
within sixty (60) days after this Code becomes effective, set up a
permanent Supervisory Agency to succeed the Temporary Agency.
Such permanent Agency shall be elected by the members of the
Trade, each member of the Trade to have equal vote. Such election
shall be by mail ballot, which ballot shall be sent to all known mem-
bers of the Trade. This permanent Agency shall consist of seven
(7) voting members of which at least five (5) shall be members of
the Association, and Administrator's appointees (if any) as referred
taoin Section 2 of this Article V.
Sac. 4. In order that the Supervisory Agency shall at all times be
truly representative of the Trade, and in other respects comply with
the provisions of the Act, the Administrator may provide such hear-
ings as he may deem proper; and, thereafter, if he shall find that the
Supervisory Agency is not truly representative, or does not in other
respects comply with the provisions of the Act, may require an ap-
Sprpriate modification in the method of selection of the Supervisory
Sac 5. Any member of the Trade may become a member of the
Asaesiated Machine Tool Dealers, and there shall be no inequitable
restrictions on such membership. Any member of the Trade may
participate in the preparation or any revision of, or additions or
sutplements to, this Code by accepting his prorata share of the cost
amE responsibility of creating and administering it by paying to the
Supervisory Agency his prorata share of the cost of creating and
administering this Code, as determined by the Superivsory Agency,
subject to the right of the Administrator, on review, to disapprove or
modify such determination of the Supervisory Agency.
S c. 6. Nothing contained in this Code shall constitute the mem-
bers of the Code Authority partners for any purpose. Nor shall any
member of the Code Authority be liable in any manner to anyone for
any act of any other member, officer, agent, or employee of the Code
Authority. Nor shall any member of the Code Authority, exercising
reasomable diligence in the conduct of his duties hereunder, be liable
to.anyone for any action or omission to act under this Code; except
for his.own willful misfeasance or nonfeasance.
'She. 7. The Supervisory Agency shall have the following duties
andt powers to the extent permitted by this Act and subject to the
.right of the Administrator, upon review, to disapprove or modify
any action taken by the Supervisory Agency.
(a) To collect from members of 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; also to collect such data, re-
ports, and statistics as may be required from time to time by the
Supervisory Agency. All such information shall be kept confiden-
tial, except insofar as disclosure may be necessary for the effective
administration and enforcement of this Code. Such data as may be
requested by the Administrator shall be made available to him.
Reports submitted by the Supervisory Agency to the President or
the Administrator shall be in the form prescribed or provided by
him. Nothing in this subdivision shall be considered as limiting the
powers conferred on the President or the Administrator by Title I
of the Act.
(b) In addition to information required to be submitted to the
Supervisory Agency, 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 Act.
(c) To hear and investigate complaints and attempt to adjust the
same in accordance with law.
(d) To study the trade-practice provisions of Article VI hereof,
and the operations thereof, and make such recommendations from
time to time to the Administrator as it deems desirable for modifica-
tion or addition thereto, which, upon the approval of the Adminis-
trator, after such hearing as he may prescribe, shall become a part of
this Code and have full force and effect as provisions hereof.
(e) To represent the Trade in conferring with the President or his
agents with respect to the administration of this Code and in respect
to the Act and any regulations issued thereunder.
(f) To make rules and regulations necessary for the administra-
tion of this Code.
(g) To coordinate the administration of this Code with such codes,
if any, as may be adopted by any subdivision of this Trade or any
related Trade or Industry, with a view to providing joint and. har-
monious action on all matters of common interest, all with the
approval of the Administrator.
(h) Any notice, demand, or request required or permitted t6 be
given to or to be made upon any member of the Trade shall be suffi-
ciently given if mailed, postage prepaid, addressed to such member of
the Trade, at his address on file with the Supervisory Agency.
(i) Whenever in the judgment of the Administrator and the
Supervisory Agency of the Machine Tool and Forging Machinery
Industry and the Supervisory Agency herein established it becomes
advisable to appoint an arbitration board, such action shall be taken.
ARTICLE VI-TRADE PRACTICES
SECTION 1. Unfair practices shall be deemed to be practices or acts
which by subterfuge, concealment, misrepresentation, or by any form
of discrimination, result in selling below published prices, or ii de-
ceiving or misleading purchasers, or in misrepresenting the goods of
competitors. The following specific practices constitute fair
methods of competition for members of the Trade and shall be
SEC. 2. False Marking or Brandings.-The false marking or brand-
ing of any goods which has the tendency to mislead or deceive cus-
tomers or prospective customers, whether as to the grade, quality,
quantity, substance, character, nature, origin, size, finish, or prepara-
tion of any such goods or otherwise.
SEC. 3. Misrepresentation or False or Misleading Advertising.-
The making or causing or knowingly permitting to be made or
published any false, materially inaccurate, or deceptive statement, by
way of advertisement or otherwise, whether concerning the grade,
quality, quantity, substance, character, nature, origin, size, finish,
or preparation of any goods of the Trade, or the credit terms, values,
policies, or services of any member of the Trade, or otherwise having
the tendency or capacity to mislead or deceive customers or
SEC. 4. Commercial Bribery.-Directly or indirectly to. give or
permit to be given, or offer to give, money or anything of value to
agents, employees, or representatives of customers or prospective
customers, or to agents, employees, or representatives of competitor's
customers or prospective customers, without the knowledge of their
employers or principals, as an inducement to influence their ent-
ployers or principals to purchase or contract to purchase from the
makers of such gifts or offers, or to influence such employers or
principals to refrain from dealing or contracting to deal with
SEc. 5. Interference with Contractual Relations.-Maliciously in-
ducing or attempting to induce the breach of an existing oral or
written contract between a competitor and his customer or source of
supply, or interfering with or obstructing the performance of any
such contractual duties or services.
SiE. 6. Secret Rebates.-The secret payment or allowance of re-
bates, refunds commissions, credits, or unearned discounts, whether
in the form of money or otherwise, or the secret extension to certain
purchasers of special services or privileges not extended to all pur-
chasers on like terms and conditions.
SEc. 7. Giving of Prizes, Premiums, or Gifts.-The offering or
giving of prizes, premiums, or gifts in connection with the sale of
goods, or as an inducement thereto, by any scheme which involves
lottery, misrepresentation, or fraud.
SEc. 8. Defamation.-The defamation of competitors by falsely
imputing to them dishonorable conduct, inability to perform con-
tracts, questionable credit standing, or by other false representations
or by the false disparagement of the grade or quality of their goods.
SEc. 9. Threats of Litigation.-The publishing or circulating of
threats of suits for infringement of patents or trade marks or of any
other legal proceedings not in good faith, with the tendency or
effect of harrassing competitors or intimidating their customers.
SEc. 10. This Trade is engaged in the business of distributing ma-
chine tools to industrial users and not to the general public. Some of
the product is sold directly by the manufacturer, and some by com-
mission salesmen and agents, and all resales are on a commission
basis. In order that open prices may be maintained without discrim-
ination, it is established that the individual manufacturers' published
prices shall govern. Therefore, no member of the Trade in selling
goods on a commission, as above outlined shall deviate from the
manufacturers' f.o.b. factory price lists and discounts, or sell directly
or indirectly by any means whatsoever, any of such goods at a price
lower or at discounts greater than those provided in the manufac-
turer's current net price lists or price lists and discount sheets,
except damaged and obsolete goods, and then only after being
reported to the Supervisory Agency.
Sim. 11. To quote a lump sum price on any schedule of goods
which does not show unit prices, or to make any additions or reduc-
tions on any other basis than the unit prices shown.
SEC. 12. To quote delivered prices or invoice purchaser without
adding to the f.o.b. factory prices, transportation, and other charges
and to fail to state in quotation where freight is prepaid that such
prepaid freight will be charged as a separate item and billed net
ARTICLE VII-TRADING AREA COMMITTEE
SECTION 1. The Supervisnry Agency shall establish in each Trad-
ing Area a Trading Area Committee of not more than three members
of the Trade to assist in administering this Code within such trading
area, subject to review of the Administrator.
SEC. 2. Each Trading Area Committee may establish subject to
the approval of the Supervisory Agency and the Administrator, a
trade-in plan to govern all members of the Trade within the juris-
diction of such Trading Area Committee.
ARTICLE VIII-GENERAL PROVISIONs
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-organization 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 refrain from joining, organizing, or assisting a labor organiza-
tion of his own choosing.
SEC. 3. Employers shall comply with the maximum hours of labor,
minimum rates of pay, and other conditions of employment ap-
proved 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
provisions of subsection (b) of Section 10 of the Act from time to
time to cancel or inodify any order, approval, license, rule, or regu-
lation issued under Title I of said Act and specifically, but without
limitation, to the right of the President to cancel or modify his
SEC. 5. Within each State, members of the Trade shall comply
with any laws of such State imposing more stringent requirements
regulating the age of employees, wages, hours of work, or health,
fire, or general working conditions, than under this Code.
SEC. 6. Such provisions of this Code as are not required to be
included herein by the Act may, with the approval of the President,
be modified or eliminated as changes in circumstances or experience
may indicate. It is contemplated that from time to time supplemen-
tary provisions to this Code or additional codes may be submitted
for the approval of the President to prevent unfair competition in
price or other unfair and destructive competitive practices and to
effectuate the other purposes and policies of Title I of the Act con-
sistent with the provisions thereof.
SEC. 7. No provisions in this Code shall be interpreted or applied
in such a manner as to:
a) Promote monopolies or monopolistic practices;
b) permit or encourage unfair competition;
c) eliminate or oppress small enterprises; or
d) discriminate against small enterprises.
SEC. 8. If any member of this Trade is also a member of any
other Trade or Industry, the provisions of this Code shall apply
and affect only that part of the business of such member which is
a part of the Trade covered by this Code.
SEC. 9. Whereas the policy of the Act to increase real purchasing
power will be made impossible of consummation if prices of goods
and services increase as rapidly as wages, it is recognized that price
increases should be delayed and that when made they should so far
as is reasonably possible be limited to actual increases in the seller's
SEc. 10. Each member of the Trade shall post in a conspicuous
place full copies of this Code.
SEc. 11. This Code shall be in effect beginning on the eleventh
day after its approval by the President and shall be binding upon
all members of the Trade.
Approved Code No. 139
Registry No. 1149-12
UNIVERSITY OF FLORIDA
IIIIfIllIN ii2i2 I A 1111111llIIIIlI
3 1262 08583 0635