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NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
AS SUBMITTED TO THE ADMINISTRATOR AUGUST 1, 1933
AND AS APPROVED BY PRESIDENT ROOSEVELT
ON AUGUST 26, 1933
REGISTRY No. 241-02
WE DO OUR PART
GOVERNMENT PRINTING OFFICE
WASHINGTON : 1933
For sale by the Superintendent of Documents, Washington, D.C. Price 5 cents
CODE OF FAIR COMPETITION FOR THE HOSIERY INDUSTRY
An application having been duly made, pursuant to and in full complliance
with the provisions of Title I of the National Industrial Recovery Act, approve:l
June 16, 1933, for my approval of a Code of Fair Competition for the Hosiery
Industry, and hearings moving been held thereon anl the Administrator having
rendered his report containing an analysis of the said Code of Fair C'mluipetition
together with his recommendations ani lilndings with respect thereto, and the
Administrator having found that the said Code of Fair C(ompetition compnlies in
all respects with the pertinent provisions of Title I of the said Act and that
the tt'luirelncits of clauses (1) and (2) of subsection I :) of Section 3 of the
said Act Linve been met:
N.\\, Therefore, I, Franklin D. Roo-velt. President of the 'United States,
pursuant to the :llith rity vested in me by Title I of the National Ilnustrial
Recovery Act, a.ppjr',v.-l .une 16, !:-1:, and otherwise, do adopt and ajpl,rove the
rl'poirt, rI' .Iinn.ndat ions, and findi ng of the Administrator and do order that
the said (Code of Fair Competition be and it is hereby approved.
Approval Ih-eiruiiUieiitdli :
(Signed) Hu-gh S. Johnson
(Signed) FiS- NKLIN D. ROOSEVELT.
The WHITE HOUSE,
August .26, 1933.
LETTER OF TRANSMITTAL
AUGUST 25, 1933.
To GENERAL HUGH S. JOHNSON,
I have the honour to hand you herewith certain documents relating to a code
for the Hosiery Industry.
1. The HOSIERY CODE as recommended.
2. A REORT of the Deputy, analyzing the Code and discussing the effect
of its hours and wage provisions.
3. TRANSCRIPT OF HEARING.
4. NOTICE OF HEARING.
The Industrial Adviser on the Hosiery Code was Dr. George W. Taylor of the
University of Pennsylvania, who for seven years has been connected with the
Industrial Research Department of that institution. In this capacity he has
gained an extraordinary familiarity with the Hosiery Industry and much of
the attached report is based on information which he furnished.
By arrangement wit" me, the Research and Planning Division will furnish no
separate report on the Hosiery Industry and approves the data which Doctor
Taylor has given me and which I present to you.
The Labor Adviser on the Code was Mr. Sidney Hillman, and the Consumers'
Adviser was Mr. C. C. Balderstnu, to both of whom I am greatly indebted for
valuable assistance and advice.
GEORGE W. TAYLOR,
Representing the Industrial Adri.rory Board.
Representing the Labor Advisory Board.
C. C. BALDERSTON,
Representing the Consumers' Adrisory Board.
ERNEST A. GROSS,
* Approved before leaving for Philadelphia.
Digitized by the Internet Archive
in 2011 with funding from
University of Florida, George A. Smathers Libraries with support from LYRASIS an'd Ihe Sloan Foundation
CODE OF FAIR COMPETITION FOR THE HOSIERY
To effectuate the policy of Title I of the National Industrial Re-
covery Act, the following provisions are submitted as a Code of Fair
Competition for the Hosiery Industry, and upon acceptance by the
President, shall be the standard of Fair Competition for this in-
1. The term "Hosiery Industry", as used herein, includes the
manufact during, finishing, repairing, selling, and/or distributing by
manufacturers at wholesale or retail, or distributing by wholesalers
and selling agents, of hosiery, and other related branches, as may
from time to time be included under the provisions of this Code.
2. The term "productive operations" is meant to embrace those
operations in the plant which have to do with the manufacturing
and packing of hosiery, to the point where it is ready for storage or
3. The term "Association shall be understood to mean the
National Association of Hosiery Manufacturers.
4. The term person shall include natural persons, partnerships,
associations, and corporations.
5. The term Code Authority shall refer to the Hosiery Code
Authority as described in Article IX of this Code.
6. The term productive equipment when used in this Code shall
refer to knitting machines.
7. The term Sub-standard employee shall mean one whose
established capacity to produce is substantially below the minimum
acceptable performance for the class of work he is doing.
ARTICLE III-DATE CODE GOES INTO EFFECT
This Code shall go into effect the second Monday following the
date on which it shall be approved by the President.
ARTICLE IV-HOURS OF WORK
1. On and after the date on which this Code goes into effect, no
person in the Hosiery Industry shall employ any employee in pro-
ductive operations on a schedule of hours of labor which shall exceed
forty (40) hours per week.
2. It is understood that the above limitation on hours of work shall
not apply to office employees, supervisors, foremen, engineers, fire-
men, electricians, repairshop men, dyers, shipping force, watchmen,
cleaners, outside workers, sales force, and those engaged in emergency
maintenance or repair work.
3. On and after September 4, 1933, the maximum number of hours
for office employees in the Hosiery Industry shall not exceed an
average of forty (40) hours per week over each period of six months.
4. On or before January 1, 1934, the Code Authority shall prepare
and submit to the Administrator suggestions for a schedule of maxi-
mum hours and minimum wages to apply to those employees ex-
cepted under Section 2 of this Article.
5. It is interpreted that the provisions for maximum hours estab-
lish a maximum of hours of labor per week for every employee cov-
ered, so that under no circumstances will such an employee be em-
ployed or permitted to work for one or more employers in the Indus-
try in the aggregate in excess of the prescribed number of hours in
a single week.
6. The productive operations of a plant shall not exceed two shifts
of forty (40) hours each per week. The work week for productive
operations, except dyeing, shall not exceed five (5) days of eight (8)
hours each. These days shall be Monday to Friday, inclusive, ex-
cept in those states where the state laws operate to prevent the opera-
tion of two forty (40) hour shifts within the mentioned five (5)
days. In such states, the employer may operate one shift on Satur-
day, not to exceed four (4) hours, it being definitely understood that
his total machine hours shall not exceed eighty (80) hours per week.
7. For a period of six (6) months following the date on which
this Code goes into effect, full-fashioned hosiery plans whose foot-
ing equipment on July 24, 1933, was being operated on a two-shift
basis may continue to operate such equipment on a two-shift basis,
but. the length of cach of these shifts shall not exceed thirty-five (35)
hours per week. The rates paid to knitters, knitting-helpers, and
toppers working on these thirty-five (35) hour shifts, shall be such
as to provide thml i earnings equal to those which they would receive
if working on forty (40) hour hlifts. Full-fashioned hosiery mills
whose footing equipment on July 24, 19,33, was being operated on a
one-shift basis shall not, during said six (6) months, operate such
equipment more than one shift of forty (40) hours per week. Not
later than thirty (30) days before the expiration of the mentioned
six (6) months, the Code Authority shall submit, for the. Adminis-
trator's approval, a reconmnendation for determining a more per-
manent policy respecting footer operation designed to effect a rea-
sonable balance between production and demand.
8. Malnufnifturers. of woolen hosiery may operate their knitting
equipment not to exceed. three (3) shifts of forty (40) hours each
until December 31, 1933, after which time their knitting operations
shall be limited to two (2) shifts of forty (40) hours each. This
exception applies only to the manufacture of hosiery which contains
at least twenty percent. (20%) of wool.
On and after the date on which this Code becomes effective the
minimum wage, on the basis of forty (40) hours' labor per week, to
be paid by all employers in the Hosiery Industry shall be at the
1. FULL-FASHIONED MANUFACTURE
M iimum weekly rate
Classification of workers
Class 1: Leggers, footers.
36 gauge and below .................-----------------------------...............---------.........---------................ $18.50 $16.75
39 gauge ..................................................................... 20.00 18.00
39 gauge ------------------------------------------------------------ 20.00 18.00
42 gauge .....---------------....------------------.....----------------..... 21.50 19.50
45 gauge .................................................................... 23.50 21.25
4S gauge .................................................................... 25.50 23.00
51 gauge and above........ ..................................... .. ......... 27.50 24. 75
C lass 2: Boarders ...................-............-.. ............................ 17.00 15.50
Class 3: Toppers, loopers, seamers, skein winders, menders, pairers, finished in-
spectors, helpers on knitting (over six months' training), pairer-folders ....... 15.00 13.50
Class 4: Stampers, boxers, gray examiners, folders, cone-winder., other produc-
tive workers. learners (including machine helpers, for the second 3 months of
their training ................................................................. 13.00 12.00
Class 5: Learners (including machine helpers), for the first 3 months of their
training......----.................. .........................................-- 8.00 8.00
2. SEAMLESS MANUFACTURE
Minimum weekly rate
Classification of workers
Class 1: M machine fixers ..................................... .................... $18.00 $16.25
Class 2: Knitters (above 240 needle), loopers (above 240 needles, boarders........ 14.00 12.75
Class 3: Knitters (240 needle and below), loopers (240 needle and below), seamers,
toppers, menders, pairers, welters, trimmers, stampers. folders, hoxers, inspec-
tors, winders, knitters (ribbed top), shipping help, machine fixer helpers, other
productive workers....... ..--- .......--- -- ........................................ 13.00 12.00
Class 4: Learners (first 3 months' training) ....--....--- ..-- ............-----. 8.00 8.00
3. It is interpreted that tho provisions for a minimum wage in this
Code establish a guaranteed minimum rate of pay per hour of em-
ployment regardless of whether the employee's compensation is based
on a time rate or upon a piecework performance. This is to avoid
frustration of the purpose of the Code by changing from hour to
4. The territory constituting "b South embraces the States of Ala-
bama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Maryland,
Mississippi, North Carolina. Oklahoma, South Carolina, Tennessee,
Texas, Virginia, and West Virginia.
5. The learner's first three (3) months' training provided for under
Class 5 of Section 1 and Class 4 of Section 2 of this article is the
aggregate of his or her first three (3) months' training within the
industry, whether continuous or not, and whether employed by or
permitted to work for one or more employers.
6. The practice of requiring or permitting a knitter to pay part or
all of the wages of a knitter-helper is prohibited. The full wages
of all employees shall be paid by the employer.
7. The amount of production of work required of any employee
shall not be increased over that required for the same class of work
prior to July 15, 1933, for the purpose of avoiding the benefits to
employees prescribed by this Code with respect to wages and hours of
8. The minimum wages of substandard employees shall not be
more than twenty percent (209%) below those of regular employees
in the same classof work. The total number of substandard em-
ployees shall not at any time exceed five percent (5%c ) of all the
productive employees of the plant. They shall be registered with
the Code Authority in such manner as it may specify.
9. On and, after the date on which the Code goes into effect, the
minimum wages paid by employers in the Hosiery Industry to all
employees not specified in Sections 1 and 2 of this Article, except.
cleaners, outside workers and substandard workers, shall be at the
rate of twelve dollars ($12.00) per week in the South and at the
rate of thirteen dollars ($13.00) in the North for forty (40) hours
ARTICLE VI-CONDITIONS OF WORK
1. All productive operations shall be carried on on the premises
of a plant, this being understood to specifically prohibit the farming
out of work to be done in private homes or elsewhere than in a
plant. Exceptions, in the cases of individual workers, may be
granted where the 1proofs show that. the worker can only work at
home, and requires such work as a means of livelihood. Permits for
exceptions shall be procurable from the Code Authority which will
prescribe the nianner and con(lition under which they shall be
2. On and after the date on which this Code shall be in effect, no
person in the Hosiery Industry shall employ any minor under the
age of sixtei-n (16) year..
3. (a) All full fashioned footing machines shall be operated on a
single-lmanhine basis, i.e., one knittter, or one knitter and one knit-
ting-helper, to one mii:chine.
(b) Under no condition is a knitter to operate more thnn two full
fashioned leggiing machines. When operating two such logging ma-
chines, he shall be assisted by two knitting-helpers.
(c) The Code Authority shall collect information on the extent
of double-nmaehine full faihioned leg'ing operations as of July 15th
and as of September 15th, and make such recolnlmendations to the
Adm(init.rator as it may see fit. Pending such recommendations,
full fashioned legirincg machines operating on a single-machine basis
shall continue on such basis.
ARTICLE VII-REIORrTS AND DAT.\
For the purpose of judging the observance of the Code, of gauging
tlhe extent to which the objectives of the National Industrial Re-
covery Act are being attained, and of being able to intelligently make
any11 necessary amendments or a itions to the Colde, each person
engaged(l in the manufacture of hosiery shall furnish the National
Association of Hosiery Manufacturers properly certified reports of
such character and in such form as the Association may prescribe.
Amonig such reports to be required are the following:
1. Ald'rai,., baesc report, covering recent shipment. or production
figures in the terms of styles commonly accepted in the trade, hours
of work, plant t'peration hours, wages and equipment, etc.
2. Weekly shipment rc port.
8. Monthly production, production and seClli n costs, shl/pmentsf
stocks on hand, change in equipment, wages and hours of labor
ARTICLE VIII-FAIR TRADE PRACTICE
To assure fair competition in the Industry and proper practices
in the merchandising of hosiery, the following fair trade practice
provisions are made a part of the Code and binding on all houiery
1. Contracts.-(a) Written orders, as well as oral orders based on
practice established between the buyer and the seller concerned, shall
be performed on the terms specified.
(b) The practice of permitting the listing of a style by a customer
without a definite quantity contract is unfair trade practice.
(c) The Association shall develop uniform conditions of sale for
the use of the industry.
2. Price guarantees.-To guarantee prices against decline is an
unfair trade practice.
3. Bonuses, rebates, discounts, et cetera.-To allow commissions,
bonuses, rebates, refunds, credits, unearned discounts, or subsidies of
any kind, to a purchaser, whether in the form of money, services,
payment of any part of the wages of a customer's employee adver-
tising or otherwise, or the return of merchandise except for mill
imperfections, or the giving of premiums, when not extended to all
purchasers under like terms and conditions, is an unfair trade
Hosiery manufacturers selling merchandise under their own
brands shall have the right to enter arrangements for cooperative
advertising of such brands. Such manufacturers may also offer
exchange merchandise services, returns for credit excepted, provided
that such practices are part of their regular and customary mer-
chandising methods, and provided that these privileges are open to
all customers of such manufacturers. The manufacturer's share of
cooperative advertising referred to above shall not exceed fifty (59)
percent of the amount actually spent.
4. Selling below cost, et cetera.-(a) The selling of merchandise
below cost, except as provided under subsection C of this section
and section 8 of this article, is unfair trade practice.
(b) The billing of customers' sample requirements at less than
regular stock prices is unfair trade practice.
(c) All closeouts of discontinued styles and/or sizes and/or broken
assortments, if sold below cost, shall be stamped "Discontinued on
each hose with an indelible transfer ordered only through the
(d) Each manufacturer in the Industry shall determine costs in
a manner approved by the Code Authority.
5. Shipments on consignment.-To ship hosiery on consignment
or on memorandum is unfair trade practice.
6. Commercial bribery.-The giving of gratuities or bribes, for
the purpose of obtaining commercial advantage or preference,
whether in the form of money, goods, or privileges, is unfair trade
7. Return of merchandise for rcflnihi..n!r.-To allow a customer to
return merchandise for refinishing or redyeing without charging
actual cost therefore is unfair trade practice.
8. Sale of tu.rch /adsl otfler than fi.st qualitly.-(a) The sale of
irregulars or seconds in the packing of firsts, with the intent or effect
of deceiving the purcihaser or the ultimate consumer, is unfair trade
(b) All full-fashioned hosiery, and all seamless hosiery other than
bundle goods, which is not first quality, shall be stamped or trans-
ferred either Irregulars or Seconds on the toe or sole of each
hose, except that goods of a lower classification commonly known
as thirds must be stamped or transferred Thirds."
(c) All stamping of this nature must be indelible. The words
" Irregulars ", Seconds ", or Thirds ", must be in full-face type
letters of not less than three sixteenths of an inch in height.
9. Sale of mill runs.-To sell hosiery commonly known as Mill
Runs" containing hose which according to proper inspection as gen-
erally practiced by the industry would be classified as Irregulars"
or Seconds ", with the intent or effect of deceiving the ultimate
consumer, is unfair trade practice.
10. Sub'stitution.-To ship or deliver hosiery which does not con-
form in quality and value to the samples submitted or representa-
tions made prior to securing the order, without the knowledge or
consent of the purchaser to such substitutions, is unfair trade
11. Misbranding and improper marking.-To sell hosiery marked
or branded falsely with the effect of misleading or deceiving pur-
chasers or the ultimate consumer with respect to price, quantity,
quality, gauge, grade, substance, or value of the merchandise is
unfair trade practice.
12. Misrepresentation of materials.-(a) If any definite section or
sections of the hose be made of a material entirely different from that
of the bulk or body of the stocking, when such material gives the
appearance of silk, the hose must be stamped with the names of both
(b) No material or content shall be stamped on any hose unless it
represents at least five per cent (5%) of the hose by weight. When
two or more contents exist, if any content is stamped on the hose, all
contents constituting five per cent (5%) or more of the weight of
the hose shall be stamped and in the order of major content.
13. Imitation of competitor's mnarks.-The imitation of the trade
marks, trade names, slogans, or other marks of identification of
competitors, having the tendency to mislead or deceive the ultimate
consumer, is an unfair trade practice.
14. Obscf cace of Code.-The failure to observe any rule in this
Article of the Code, even if it does not contain the words unfair
trade practices ", is a violation of the Code.
15. ArbNitration.-All disputes, pertaining to the interpretation of
the Fair Trade provisions described in this Article of the Code, shall
be submitted to such forms of arbitration as may be set up by the
ARTICLE IX-COORDINATION AND ADMINISTRATION
1. A Hosiery Code Authority shall be established for the purpose
of administering this Code and for all other purposes hereinafter
set forth. The. Code Authority shall be constituted as follows:
(a) Eight (8) members, representative of employers, shall be
appointed by the Board of Directors of the Association.
(b) Two (2) members, representative of labor, shall be appointed
by the Administrator, on nomination of the Labor Advisory Board.
(c) Two (2) members shall be appointed by the Administrator.
2. For the purpose of assuring to the Code Authority the advice
and suggestions of the major branches of the Industry, the Associa-
tion shall provide for the selection in each major branch of the In-
dustry of an Advisory Committee. Such Advisory Committee shall
make such recommendations to the Code Authority as they may deem
necessary and advisable with reference to their particular branch
of the Industry. They may also submit recommendations affecting
the whole Industry. Such recommendations, when approved by the
Code Authority, and by the Administrator, shall become a part of
this Code and shall have full force and effect as provisions thereof.
3. It shall be the duty of the Code Authority to:
(a) Issue and distribute to all persons in the Industry, from time
to time, such posters or notices as, in its judgment, shall be displayed
in the plants of the Industry for the purpose of bringing to the at-
tention of all employees, provisions of the Code which affect them,
and interpretations thereof by the Code Authority. The Code Au-
thority may specify the manner in which such notices or posters shall
be displayed. Failure to comply with such instructions shall be
an infraction of the Code.
(b) Review all questions or disputes arising under this Code. It
shall have the power, subject to the approval of the Administrator,
to dispose of such issues directly or by such means or media as it
may designate or set up for the purpose.
(c) Report to the Administrator all violations or infractions of
the Code which have been submitted to it in writing. The Code
Authority may submit with such reports its recommendations as to
appropriate action thereon.
(d) Investigate the importation of competitive articles into the
United States on such terms or under such conditions as to render
ineffective or seriously endanger the maintenance of this Code, and
act as the agency for making complaint to the President on behalf
of the Hosiery Industry.
(e) Submit to the Administrator from time to time such recom-
mendations as, in its judgment, will have the effect of improving
the Code, or of improving the results secured thereunder, any of
which recommendations, when approved by the Administrator, shall
have force and effect as provisions of this Code. Every recom-
mendation shall be made only after a proper canvass of the opinion
of the Industry. In submitting any recommendation to the Admin-
istrator, the aggregate number of mills as well as the aggregate
productive capacity, favoring or opposing the recommendation, shall
be indicated. Such recommendations shall, among others, be of
the following character:
(1) Recommendations for changes in those provisions of the Code
which relate to hours of work, plant hours, minimum wages and
working conditions, as may seem desirable in the light of experience
under the Code.
(2) Recommendations for changes and additions in those provi-
sions of the Code which relate to fair trade practices.
(3) Recommendations (a) for the requirement by the Adminis-
trator of registration by persons engaged in the Hosiery Industry
of their productive equipment, (b) for the requirement by the Ad-
ministrator that prior to the installation of additional productive
equipment (except for the replacement of existing equipment of
equal capacity or to establish balance in existing equipment) by
persons engaged or engaging in the Hosiery Lidustry, such persons
shall secure certificates that such installation will be in accord with
the objectives of the Act.
(4) Recommendations for the acquisition and disposal of surplus
used equipment, or the scrapping of fully depreciated obsolete equip-
ment, and as an aid to maintaining proper balance between produc-
tive capacity and expectable demand.
(5) Recommendations as to requirements by the Administrator
of uniform methods of cost accounting to assure against unfair com-
petition and a demoralization of the market through selling below
cost (other than distress merchandise), and otherwise to assure
compliance with the provisions of the Code.
4. The cost of the administration needed to secure proper observ-
ance of this Code and any additions thereto, the compilation of
statistical data, and such other activities as may be necessary shall
be apportioned pro rata, so far as is practicable, to all persons in the
Industry whether or not they are members of the National Associa-
tion of Hosiery Manufacturers.
ARTICLE X-ADJUSTMENT OF PRIOR CONTRACTS
Where the costs of executing contracts entered into in the Industry
prior to June 16, 1933, are increased by the application of the pro\i-
sions of this Code to the Industry, it is equitable and promote ive of
the purposes of this Code that appropriate adjustments of such
contracts to reflect such increased costs be arrived at. Further, if
the fulfillment of orders is delayed or prolonged as the result of
the operations of this Code, appropriate additional time shall be
allowed for the completion of such orders. The Association is
constituted an agency to assist in effecting such adjustments.
ARTICLE XI--RIcIITS OF EMPLOYEES
National Industrial Recovery Act, Section 7, subsection a,
"(1) Employees shall have the right to organize and bargain collec-
tively 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; (2) No
employee and no one seeking employment shall be required as a
condition of emploIyment to join any company union or to refrain
from joiinng, organizing, or assisting a labor organization of his
own choosing; and (3) Employers shall comply with the maximum
hours of labor, minimum rates of pay, and othllr conditions of
employment, approved or prescribed by the President."
ARTICLE XII-MONOPOLY AND DISC IMINATION
No provision of this Code shall be interpreted or applied in any
manner which shall-
1. Promote monopolies.
2. Permit or encourage unfair competition.
3. Eliminate, oppress, or discriminate against small enterprises.
ARTICLE XIII-AMENDMENTS AND ADDITIONS TO CODE
1. This Code takes into consideration the provisions of Section 10,
Subsection b, of the National Industrial Recovery Act, by which
" The President may from time to time cancel or modify any order,
approval, license, rule, or regulation issued under this title; and each
agreement, code of fair competition, or license approved, prescribed,
or issued under this title shall contain an express provision to that
2. It is anticipated that experience under the Code will suggest or
demand modifications of or additions thereto, to better accomplish
the objectives sought by the National Industrial Recovery Act. Any
proposed changes or addition will be submitted for the approval of
REPORT ON A CODE FOR THE HOSIERY INDUSTRY
The Hosiery Industry includes manufacturers and distributors
of various types of full-fashioned and of seamless hosiery. The one
representative trade association of the industry is the National Asso-
ciation of Hosiery Manufacturers. According to a survey recently
undertaken by the Association, its members operate over seventy per-
cent (70%) of the total full-fashioned equipment of the industry,
and account for approximately seventy-eight percent (78' ) of the
total shipments of fashioned hosiery. In the seamless branch of the
industry, members of this Association are responsible for nearly
seventy percent (70%,) of total shipments and operate over two
thirds (/3) of the machine equipment.
By an executive order dated July 26, 1933, the National Associa-
tion of Hosiery Manufacturers agreed with the President. that pend-
ing the approval of a code of fair competition for the industry,
member manufacturers should be bound by certain provisions of
their proposed code of fair competition, to wit: the provisions fixing
maximum hours and minimum wages for various crafts and putting
limitations on the use of machinery. A code of fair competition for
the Hosiery Industry was submitted to the Administrator on August
1, 1933; a hearing was held on August 10, 1933, the code was revised
in s-ub-lquent conferences, and is herewith recommended for
The Code of Fair Competition for the Hosiery Industry as recom-
mended may be summarized as follows:
Article I enumerates the purposes of the Code.
Article II sets forth certain definitions.
Article III specifies the (late the Code shall go into effect.
Article IV lists the provisions relating to hours of labor and limits
the operation of productive equipment.
Article V designates the minimum weekly wages payable to em-
ployees in various occupational groups, and places certain interpre-
tations upon the application of these minimum rates.
Article VI prohibits the farming out of work to private homes,
specifies that minors under sixteen (16) years of age are not to be
employed, and provides against extension of machine stretch-out.
Article VII outlines the manner in which statistical reports and
data are to be collected.
Article VIII enumerates the fair trade practice provisions of the
Article IX provides for the establishment of a Hosiery Code
Article X constitutes a means for assisting in the adjustment of
contracts made prior to June 16, 1933.
Article XI quotes the provision of Section 7 (Subsection (a)) of
the National Industrial Recovery Act.
Article XII insures against applying the Code to promote monopo-
lies, permit unfair trade practice, or discriminate against small
Article XIII quotes the provisions of Section 10 (Subsection (b))
of the. National Industrial Recovery Act with respect to amendments
or additions to Code.
LOCATION OF INDUSTRY
A census made in July 1933 shows that there are eight hundred
and fifty-three (853) hosiery manufacturing establishments in the
United States, two hundred and eighty-eight (288) engaged princi-
pally in the knitting of full-fashioned hosiery, while five hundred
and sixty-five (565) are classed as seamless plants, certain of which
manufacture other types of knit goods. About one half () of the
fashioned mills, operating fifty-eight percent (58%,) of the full-
fashioned equipment of the industry, are located in Pennsylvania,
mainly in the cities of Philadelphia and Reading. Other important
centers of full-fashioned manufacture are North Carolina, the New
York-New Jersey district and the Middle West, which includes the
important Wisconsin district. The seamless plants are more widely
scattered throughout thirty-three (33) states, but almost one fourth
() are located in North Carolina and nearly one half () in the
southern states. Pennsylvania is also an important center for seam-
less manufacture, its mills representing over twenty-three percent
(23%) of the total number of manufacturing establishments.
PRODUCTION AND HotRS OF WORK
The production of hosiery of all types combined has not been sub-
ject to extreme yearly fluctuations within the past decade. It is sig-
nificant that, even since 1929, the industry has experienced but a
relatively minor decrease in the total dozen pairs it has manufactured
and shipped. In 1932, for instance, production was only about
twelve and two-tenths percent (12.2%) below the level attained in
1929, the year of peak production. These facts are evident from the
Production trends in the hosiery industry, 1923-1932
Value of Average
Produe- Produc- ou- number
Year tion I tion index tion wage
pairs of dollars
1923 --.-------..----.----------------------------- 97.4 87.6 J7. 7 96, 957
1925.---------...................------------... --------------------- 99.8 89.7 403.9 103,930
1927--..-...............----..... ...-----...-------------.-- 103.2 92.8 440.6 112.842
1929--.---.........-- ...-- .... .. ...-------- --------.------- 111.2 100.0 528.7 129.542
1931- ...-------- ---..........................---------. -- ------..--- .. 9. 2 83.8 317.9 107.868
1932--..........---------. ...-......-----------...- ...-- .....--- .. 97.6 87.8 .......... 112, 830
Source: U.S. Census of Manufactures.
1 Production of all types of hosiery except infants', athletic, and golf bose.
I Preliminary estimate.
But despite the fact that the total demand for hosiery remained
relatively stable, significant intraindustry adjustments took place.
Of outstanding importance were the rapidly increasing production
of women's full-fashioned hosiery and a significant displacement of
the seamless product. The full-fashioned branch of the industry
knit about six million (6,000,000) dozen pairs of hosiery in 1919, as
compared with approximately thirty million (30,000,000) dozen
pairs in 1932. Since 1929 the production and shipments of both
women's full-fashioned and women's seamless hosiery have remained
rather constant and at a relatively fixed ratio between the two
With only a minor falling off in shipments of hosiery in all classes
since 1929, the industry has had a serious unemployment and under-
employment problem. In part the solution of this problem involves
the re-absorption by the industry of former but now displaced, em-
ployees. To a much greater degree the problem involves the provi-
sion of more nearly full-time employment for those who since 1929
have received only part-time employment.
During the last four (4) years, the production of hosiery has been
characterized by a seasonality of increasing severity. This is par-
ticularly true of the full-fashioned branch of the industry where the
effect of seasonal plant operations upon employment is particularly
marked. According to a study recently made by the Industrial Re-
search Department of the University of Pennsylvania of the 1932
payrolls of seventeen (17) full-fashioned hosiery concerns it appears
that the chance to work was offered to about one sixth (1/e) of the
workers of those concerns for less than five (5) months in the year.
For almost four (4) months in 1932, one fourth (1/4) of the em-
ployees lacked the possibility of any employment. One of the most
difficult and important problems to be met by the industry is the
disposition of its large labor reserve which is not utilized for short-
This labor reserve and the irregularity of operations must be borne
in mind when data pertaining to average number of workers em-
ployed are considered. The average number employed must be
increased by providing more steady employment. Reference to the
preceding Table I reveals that the hosiery industry employed an
average work force of one hundred and seven thousand eight hun-
dred sixty-eight (107,868) persons in 1131. A special tabulation
made by the Bureau of the Census for 1931 shows that full-fashioned
mills employed sixty-one thousand nineteen (61,019) workers on the
average, as compared with an average of forty-eight thousand five
hundred two (48,502) employees in the seamless branch of the in-
dustry. The total of this special tabulation (one hundred nine thou-
sand five hundred twenty-one (109,521)) includes certain workers on
children's seamile-s goods not included in the total of Table I.
For the week of July 10, 1933, a survey of number of workers em-
ployed was made by the National Association of Hosiery Manufac-
turers. The combined reports show that during that week fifty-six
thousand four hundred twenty-seven (56,427) employees worked at
two hundred fifty-seven (257) full-fashioned hosiery mills and the
four hundred six (406) seamless mills employed fifty-three thousand
nine hundred twenty (53,920) workers. It was thus estimated that
fifty-seven thousand (57,000) productive workers were employed in
each of the two (2) branches of the industry, or a total of one hun-
dred fourteen thousand (114,000). On the basis of the average hours
worked by a representative number of these employees, it may be
estimated that a total of five million nine hundred thousand (5,900,-
000) man-hours were worked in turning out the production of that
week. Had the same production been made by a group of employees
working forty (40) hours per week, a total of one hundred forty-
seven thousand (147,000) workers would have been required instead
of the one hundred fourteen thousand (114,000) workers who were
actually employed. The forty (40) hour week provision of the Code
would have made it possible to employ thirty-three thousand (33,000)
additional employees during the week in question. Hence it is clear
that the forty (40) hour week for hosiery workers will go far to:
1. Reemploy workers skilled in hosiery manufacture who have
been forced to leave the industry.
2. Insure more nearly full-time employment for the great ma-
jority of the workers who have remained in the industry.
In 1929, the industry employed an average work force of one
hundred twenty-nine thousand five hundred forty-two (129,542)
workers, but with less seasonality of production than now. There
was part-time employment for the month of that year's maximum
activity. There were approximately one hundred fifty thousand
(150,600) persons at work. Hence by restricting hours of work
per worker to forty (40) per week, it is anticipated that employment
can be got back to the 1929 level, and that the extent of short-time
work for any lhrge number of employees will be materially lessened.
The Hosiery Code embodies in Article V significant provisions
for the payment of minimum wages. In both the full-fashioned
and seamless branches of the industry, occupational groupings have
been made on the basis of the skill required. For each group of
workers, a minimum wage has been specified, except for the full-
fashioned knitters, who are subject to six different minima, depend-
ing upon the gauge (fineness) of the machine operated. In the
preparation of its Code, the hosiery industry set the various mini-
mum wages in order to insure that a minimum wage established for
the least skilled workers could not exercise a depressing effect upon
wages paid to operators of higher skill. The minimum wages in
each class are particularly specified for the north and for the south,
the latter being not quite ten percent. (10%') below the northern
rates. The southern differential established by the Hosiery Code
represents a significant diminution in the range of wages that have
prevailed between northern and southern plants. It should also
be mentioned that the Code specifies the names of those states that
constitute south for purposes of application of the Hosiery Code.
Over one half (,.) of all full-fashioned employees are employed
in occupations listed in Class No. 3. This occupational group is
subject to a minimum wage of fifteen dollars ($15.00) in the North
and thirteen dollars and fifty cents ($13.50) in the South. In
appraising the significance of these wages, it is to be noted that for
the week of July 10, 1933, the workers in this classification averaged
twenty-nine cents and seven mills (29.7) per hour and fourteen
dollars and seventy-three cents ($14.73) per week. Under the
terms of the Hosiery Code, they will receive a minimum hourly
earning of thirty-seven cents and five mills (37.50) in the North
and nearly thirty-four cents (34) in the South. Since it is obvious
that in 1933, many employees must have earned below the average
wage, the new minimum earnings must result in a marked increase
in the total wages paid by the industry.
Of the total number of seamless workers employed, almost eighty
per cent (80%) work in the occupations grouped in Class No. 3 in
the schedule of rininmii earnings for the seamless industry. These
workers, the large majority of all seamless employees, earned at the
rate of nineteen cents and six mills (19.60) per hour and nine dollars
and eighty-three ($9.83) per week during the week of July 10, 1933.
The terms of the Hosiery Code specify that these employees shall
receive at least thirteen dollars ($13.00) weekly in the North and
twelve dollars ($12.00) weekly in the South. Since the work-week
has been designated at forty (40) hours, the Class No. 3 seamless
workers will receive an hourly earning of thirty-two cents and five
mills (32.5) in the North and of thirty cents (300) in the South.
Thus the minimum weekly wage for nearly eighty per cent (80%)
of all seamless workers has been placed at a level considerably higher
than the average weekly wage they received in 1933. It is evident
that significant increases in the earnings of these seamless workers
will occur as a result of the operations of the Code. The seamless
workers employed in the occupations listed in Class No. 2 will be
paid a minimum weekly wage of fourteen dollars ($14.00) in the
North and twelve dollars and seventy-five cents ($12.75) in the
South. These minimum earnings may be compared with the average
of thirteen dollars and thirty-eight cents ($13.38) earned by this
group during the week of July 10, 1933. Obviously, most of these
employees will receive important increases in the weekly wage
through the application of the minima.
Attention should be directed to the provisions for minimum wages
for learners in both the full-fashioned and seamless schedules. Lim-
ited to this first three (3) months of training in the industry
(whether continuous or not, and whether for one or more employers)
a learner receives a minimum weekly wage of eight dollars ($8.00).
After this initial training period the learner is included in groups
receiving a higher mninmum pay. Those learners reported on the
pay roll of the seamless industry during the week of July 10, 1933,
received four dollars and fifty-nine cents ($4.59) as their average
weekly wage. By the terms of the Code, learners in the industry
will receive a substantial increase in weekly earnings.
CONDITIONS OF WORK
By various terms of this Code, the hosiery industry has taken
steps to insure fair standards of work in the industry. The out-
standing provisions in this respect are as follows:
1. The Hosiery Industry has not yet experienced any significant
problem relating to the farming out of work to be done at private
homes or elsewhere than in a plant. To prevent any future diffi-
culties on this score, the above-mentioned practice has been pro-
hibited by Article VI of the Code. Exceptions may be granted by
the Code Authority only in cases of individual workers where it
is shown that a worker can only work at home and requires such
work as a means of livelihood.
2. The practice of requiring or permitting a knitter (full-fash-
ioned) to pay part or all of the wages of a knitter helper is pro-
hibited by Article V, Section 6 of the Code. The full wages of
each employee must be paid by the employer.
3. In order to prevent excessive speeding up by increases in the
task requirement, Article V, Section 7, provides that no employer
shall require of his employees a greater hourly production than that
required prior to July 1, 1933.
4. Attention has been given the so-called stretch-out problem by
the terms of Article VI, Section 3, of the Hosiery Code. It is spe-
cifically stated that no full-fashioned knitter shall operate more than
one footing machine, nor more than two legging machines. More-
over, when two legging machines are operated by one knitter, he
must be assisted by two knitting helpers. For operations on the
double machine basis the prevailing custom has been to have one
knitter and one helper operate two machines. The provision just
mentioned is designed to discourage the practice of double-machine
operation in the full-fashioned branch of the industry by increasing
the cost of utilizing this method. In addition, provision is made by
the Code for the collection of information on the double-machine
question by the Code Authority in order to provide a basis for
further recommendations in this connection.
CORRELATION OF PnODU'CTION WITHI DEMAND
Since 1929 production and shipments of women's full-fashioned
hosiery has averaged approximately thirty million (3<,000.000)
dozen pairs a year. Provision must be made to meet this demand,
with certain allowances for seasonal fluctuation, but without result-
ing in the creation of a greatly excessive capacity. A carefully
thought-out program in this connection has been briefly and simply
stated by Article IV, Sections G and 7, of the Hosiery Code. It is
provide( that productive operations of a plant shall not exceed two
shifts of forty (40) hours each. In the full-fashioned branch of the
industry, however, additional restrictions are placed upon footing-
machine operation. This was deemed necessary in order to prevent
an unwise extended use of productive capacity.
About thirty-five percent (35%'.) of the footing machine equip-
ment of the industry is so balanced with complementary legging ma-
chines as to permit the former to operate on two shifts. However,
but ten percent (10%) of the footing machines are normally operated
on two shifts. Hitherto it has not been deemed practicable to oper-
ate footers on two shifts, although the possibility of so doing would
be increased enormously on a forty (40) hour schedule per shift.
This is true because girls are employed as toppers and already exist-
ing restrictions on their hours of work have made two shiifts im-
practical. Industry conferences brought out the fact that an undue
hardship would fall upon many small concerns should single-shift
operation of the footing machines be made mandatory. On the
other hand, to allow double-shift operation of footers on the forty
(40) hour week basis would immediately result in the adoption of
this method of operation by thirty-five percent (351C) of the in-
dustry. In addition, other manufacturers could and would place
themselves on the double-shift basis in order to decrease unit costs
of production. This they could do by changing the balance of their
equipment through the addition of new legging machines. Tobinsist
upon single-shift footer operation would prove unduly burdensome
to mills operating a minority of the equipment of the industry but
representing a large number of plants. To allow double-shift opera-
tion of footers would be to offer an inducement to manufacturers to
overequip the industry and to overproduce beyond any expected
requirements for hosiery. This was the problem to be solved.
In meeting it, the representatives of the full-fashioned hosiery
manufacturers, holding opposing points of view, were neverthe-
less able to comIpronmise their differences. The reconciliation of
the divergent interests in this matter by those concerned is deserv-
ing of the highest commendlation.
Briefly, it was unanimously agreed that, for a period of six (6)
months following the date on which the Code becomes effective,
footing machines that were being operated on double shift on
July 24, 1933, may continue on this basis, but that the length of
each shift shall not exceed thirty-five (35) hours per week. The
rates to be paid to operators of these machines will provide them
earnings equivalent to what they would receive if working on forty
(40) hour shift. Footing machines that were being operated
on a single shift basis, prior to July 24, 1933, are to continue on
that basis with forty (40) hours per shift. At the expiration of
the six (6) months, trial period, the Code Authority is to submit
for the approval of the Administrator a recommendation for deter-
mining a more permanent policy respecting footer operation.
The above arrangement insures that there will be no immediate
and undue increase in productive capacity as a result of increasing
the number of shifts being operated by footing machines. In addi-
tion, the increase of the labor cost of operating footers on two
shifts eliminates any urge for manufacturers so to operate their
equipment unless this is absolutely necessary to meet normal re-
quirements. Through the operation of the terms of the provision
just discussed, the manufacturing cost by means of single and
double footer shift operation is virtually identical.
The handling of the footer shift question by the full-fashioned
hosiery industry represents a rather outstanding example of indus-
trial self-government. Effective steps to bring about a balancing
of production and demand, and in such a manner as to impose no
undue hardship on any manufacturer were taken by the industry
and were embodied in the Code as submitted to the Administrator.
An additional problem, somewhat similar in nature, involved the
woolen branch of the industry. Because of the seasonal nature of
the demand for their product, woolen manufacturers anticipated that
conformance with the two shift regulation would result in their in-
ability to meet the normal requirements of their trade. By the pro-
visions of Article IV, Section 8, of the Code, manufacturers of woolen
hosiery are permitted to operate their knitting equipment not to
exceed three (3) shifts of forty (40) hours each until December 31,
1933. After this date their knitting operations shall be limited to
two (2) shifts of forty (40) hours each.
This Code establishes a Hosiery Code Authority by means of Ar-
ticle IX entitled Coordination and Administration." This Code
Authority is to be composed of twelve (12) members. In addition
to the two (2) appointed by the Administrator, eight (8) will be
selected by the Board of Directors of the National Association of
Hosiery Manufacturers, and the Administrator will appoint two (2)
others on the nomination of the Labor Advisory Board.
Specific provision is thus made for labor representation on tie Code
Authority. The labor union in the hosiery industry is the American
Federation of Full-Fashioned Hosiery Workers, affiliated with the
American Federation of Labor through the United Textile Workers.
This union is not representative of workers in the seamless branch of
the industry; it has confined its activities entirely to the fashioned
section,and claims to have approximately eighteen thousand (18,000)
members who are to a large.extent in the Philadelphia district. For
the past four (4) years the union had a collective agreement with the
Full-Fashioned Hosiery Manufacturers of America, Inc., whose
approximately thirty (30) members account for twenty-six percent
(26'%") of the equipment. of the full-fashioned division. In addition,
the union claims to have individual contracts with several other con-
cerns. It has recently been organizing in other areas, and the repre-
sentation willingly accorded it. on the Code Authority is at once a
tribute to the open-mindedness of the National Association of Hosiery
Manufacturers and an augury that the Code will be administered by
employers in cooperation with employees.
Article IX of the Hosiery Code enumerates a series of recommen-
dations which the Code Authority may make to the Administrator,
These recommendations concern themselves with actions deemed dle-
sirable to effectuate the lpurlposes of the National Industrial Re-
FAIn T.mrDE PRACTICES
Article VIII of the Hosiery Code is a series of sixteen (16) fair
trade practice provisions to assure fair competition in the industry
and proper practices in tlhe merchandising of hosiery. Proper
branding of hosiery for the protection of the consumer is the sub-
ject of several of the fair trade practice provisions. Other sections
prohibit guarantee of prices against decline, rebates, commercial
bribery, and shipments on consignment. In Section 4 of this Ar-
ticle it is stated that the selling of merchandise below cost is an un-
fair trade practice. Provision is also made for the submission to
arbitration of disputes pertaining to the fair trade practice provi-
sions of the Code.
CASES OF INDIVIDUAL HARDSHIP
A relatively few establishments anticipate individual hardships in
adjusting their operations to the terms of the Hosiery Code. Some
of these cases arose under the Executive Order, above referred to,
and were given careful consideration. At the hearing and in sub-
sequent conferences, all these manufacturers (which fortunately rep-
resent a small minority of the industry) were given an opportunity
fully to state the problems which would be faced by them in operat-
ing under the Code. In practically all instances, these related to the
elimination of third shifts by Code provision. The great majority
of firms in the industry have operated their equipment on a one or
two shift basis. In determining fair standards for the industry as
a whole, it was impossible to prevent occasional individual hardship.
Some mills in reducing from three to two shifts will have to reduce
employment, but for the industry as a whole the limitation means
stabilization and a great increase of employment. For the rare mill
hitherto on three shifts or for the rare group of employees affected
by the change to two shifts loyally to accept the provision is true
The Deputy Administrator finds that:
(a) The Code as recommended complies in all respects with the
pertinent provisions of Title I of the Act, including without limi-
tation, subsection (a) of Section 7, and subsection (b) of Section
10 thereof; and that
(b) The National Association of Hosiery Manufacturers imposes
no inequitable restrictions on admission to membership therein and
is truly representative of the Hosiery Industry; and that.
(c) The Code as recommended is not designed to promote mo-
nopolies 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.
AUGUST 25, 1933. Deputy Administrator.
AUGUST 25, 1933.
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