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UNIVERSITY OF FLORIDA V,
3 1262 08482 9984Ill I II
3 1262 08482 9984
NATIONAL RECOVERY ADMINISTRATION
CODE OF FAIR COMPETITION
AS SUBMITTED ON AUGUST 30, 1933
REGISTRY No. 246-01
The Code for the Linen Industry
in its present form merely reflects the proposal of the above-mentioned
industry, and none of the provisions contained therein are
to be regarded as having received the approval of
the National Recovery Administration
as applying to this industry
k MEMBER .1d
GOVERNMENT PRINTING OFFICE
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CODE OF FAIR COMPETITION FOR THE LINEN
To effectuate the policy of Title I of the NATIONAL INDUS-
TRIAL RECOVERY ACT, during the period of the emergency
by reducing and relieving unemployment, improving the standards
of labor, thus increasing the purchasing power, eliminating unfair
competitive practices destructive to the interest of the employer
and employees; relieving the disastrous effects of overproduction
and otherwise rehabilitating the linen industry, the following pro-
visions are established as a code of fair competition.
The term LINEN ASSOCIATION as used herein is defined to
mean manufacturers, converters, and importers engaged principally
in the wholesale distribution of goods wholly or chief value linen.
A. The term EMPLOYEES as used herein shall include all per-
sons employed in the conduct of such operations.
B. The term EFFECTIVE DATE as used herein shall be the
first Monday following the approval of this code by the President.
C. The term PERSONS as used herein shall include natural per-
sons, partnerships, associations, and/or corporations.
D. Peasant type or printed linens are regarded in the trade as
E. Fancy linens, as distinguished from staple linens, are linens
that have been decorated, embroidered, or lace trimmed.
F. Hemstitched linens, damasks, or plain sheets, towels, and pil-
lowcases are classified as staple linens.
Any individual, partnership, company, corporation, or manufac-
turer's representative or agent enased in the importation. conver-
sion, or wholesale distribution of linens shall be eligible for
membership in the LINEN ASSOCIATION. The LINEN ASSO-
CIATION truly represents the industry for which it acts.
4. WAGES, HOURS, ETC.
Effective immediately, the minimum wage which shall be paid by
employers in the LINEN ASSOCIATION to any of their em-
ployees, factory or mechanical workers, or artisans, shall be $13.00
per week and forty hours per week shall be the maximum working
hours, with the exception of a six-week period of overtime during
which a maximum of 44 hours per week shall prevail at 113 pay
for the overtime, with the understanding that the maximum hours
per week for the year's average shall not exceed 40 hours. No
labor shall be engaged under the age of sixteen years. Minimum
wages for accounting, clerical, office, service, or sales employees-
excepting outside salesmen-shall be fifteen dollars per week and
the maximum working hours shall be forty hours per week.
5. RwrIHT TO ORGANIZE
Employees or persons subject to the jurisdiction of this code shall
have the right to organize and bargain collectively through repre-
sentatives of their own choosing, and shall be free from interference,
restraint, or coercion of employers of labor or their agents, in the
designation of such representatives or in self-protection or any other
concerted activities for the purpose of collective bargaining or other
mutual aid or protection. No employee or person subject to the
jurisdiction of this code and no one seeking employment from such
persons shall be required as a condition of employment to join any
company union or to refrain from joining, organizing, or assisting a
labor organization of his own choosing.
The terms of the LINEN ASSOCIATION shall not be in excess
of 3 percent. for payment in ten days with the option of E.O.M.
or two percent for longer dating not in excess of 70 days from date
of invoice. Shipments of the 25th of the month and after shall
be allowed as of the 1st of the month. No further dating allowed.
7. DELIVERY OF MEIR HIANDISE
Delivery of merchandise is F.O.B. point of origin or main office,
and where the shipping point is New York City, the five boroughs
only. For stock-carrying branch offices east of the M1ississippi River
a minimum of 21/% must be added to the main-office price; west
of the Mississippi a minimum of 5% must be added to the main-office
price. Branch offices are allowed to make free local city delivery
after above minimums have been added.
No rebate shall be given in any form whatever. This also pro-
hibits such items as absorption of transportation costs, special dis-
counts, commissions, advertising allowances, or free salable samples
with the exception that in fancy linens a maximum discount of ten
percent may be allowed for import orders where the minimum time
of delivery from date of confirmed order is sixty days. This import
discount must not violate the provisions of paragraph 12.
9. COMMERCIAL BRIBERY
No gratuities of any nature shall be given to buyers and/or buying
offices or their principals or agents nor shall any commissions or
rewards in any form whatever be paid them directly or indirectly.
10. GUARANTEE AGAINST PRICE FLUCTUATIONS
No prices shall be guaranteed to any purchaser against a decline.
11. MARKING AND LABELING
A. Commencing January 1, 1934, merchandise shall be accurately
marked. Any merchandise remaining in warehouse or in stock on
the effective date must be either re-marked or the correct finished size
directed to the attention of the buyer and confirmation marked ac-
cordingly. The merchandise shall be so billed. Any merchandise
on hand or in warehouse after June 30, 1934, must be re-marked when
withdrawn from warehouse. The marked size shall not vary from
the finished size any more than three percent in either width and
length in the case of fancy linens, and a variation of only one percent
for mechanical differences in staple linens.
B. The term linen or pure linen or all-linen shall be only
used as descriptive of an article made of flax whose linen content
is above 95 percent. Commencing January 1,1934, no finished fabric
containing less than 5% linen shall be labelled with the word
"Linen" in any form. Linens containing between 5% and 95%
linen shall be labelled with the exact linen percentage content, such
figures to be printed in the same size type as the word linen."
No name shall be used on a nonlinen fabric or to describe a non-
linen fabric which is so similar, in sound or appearance, to the word
linen as to mislead a purchaser into believing it to be linen.
When linen fibres are destroyed by making them into viscose
or any solution it is no longer regarded as linen since the charac-
teristic properties of linen fibre are lost. A cotton or a mercerized
fabric which is treated to a finish by impregnating or in any manner
washing or coating with a solution, alleged to be a flax solution,
may not be identified with the term linen in any manner.
12. CoST OF MERCHANDISE
A. No merchandise shall be sold below cost except for provisions
as outlined in Paragraph Thirteen.
B. The cost of domestic manufactured merchandise shall be the
cost of labor plus material (excluding designing) plus 20 percent
for overhead. In the case of merchandise manufactured in Puerto
Rico or Philippine Islands, the cost of transporting the material as
well as the finished goods back to market shall be included in the
cost of the merchandise.
C. Imported merchandise shall not be sold for less than the actual
cost abroad plus six percent for ocean freight, insurance, entry fees,
trucking, and other miscellaneous expenses, plus the actual cost of
duty, plus taxes. To the above total shall be added fifteen percent
for overhead. This calculation applies to staple linens under Para-
graphs 1,009 A, B, 1010, 1011, 1013, 1014 of the Tariff Act, with
the exception of merchandise made to order for institutions which
is imported for resale through a distributor.
D. Imported fancy linens shall be calculated as above except that
the six percent shall cover foreign buying charges and an additional
four percent shall be added for shipping expenses. To this total
shall be added twenty percent for overhead, this calculation being
considered the cost of fancy linens.
13. SALES BELOW COST
Merchandise may be sold below cost in the following instances:
Should a drop in the market occur, the cost of such merchandise, as
defined in Paragraph Twelve, may be lowered in proportion to such
drop at the discretion of the Central Committee. Should any article
or articles be of a kind not readily salable or imperfect, then such
goods may be sold below cost, if necessary, and the report made to
the President of the Linen Association who will refer the matter
to the group in the division affected. If, however, this practice in
the opinion of the group committee is abused, it will be considered
a breach of the code.
14. EXCHANGE EQUALIZATION
For the purpose of computing costs when purchasing in foreign
currency the rate of exchange prevailing on date of exportation from
the foreign port shall be the rate upon which the cost. abroad shall
be determined. Should exchange have been purchased at a lower
rate, then the importer shall, nevertheless, base his costs for sales
purposes upon the rate prevailing at time the merchandise leaves
the foreign port. Should exchange have been purchased at a higher
rate, it shall be optional on the part of the importer to reduce the
rate to that prevailing at the time of exportation from the foreign
port. In the case of taking orders for future delivery on import
goods, the cost as regards the exchange shall be computed as of the
date that such future orders are taken and confirmed.
The members of the Linen Association agree not to send mer-
chandise to any customer on consignment, with the exception that
merchandise with a value of fifty dollars or more per unit be ex-
cluded from this restriction. Any agreement to accept the return of
merchandise, other than for the reason that such merchandise is
defective or not as represented, shall be turned over to the Investi-
gating Committee. This Committee will decide whether or not such
a return is a subterfuge and therefore a violation of this clause.
15-A. LOT SALES
The sale of any article or articles at a price that is contingent upon
concurrent purchases and sale of another article or other sizes of
an article; or the selling of different articles in group or combination
at a single or group price which does not also specify the selling price
of each separate article contained in the group or combination of
articles sold, is an unfair practice and constitutes a violation of this
code. Exception: Articles which are commonly sold in set or
16. MANUFACTURERS REPRESENTATIVE
For the purpose of this code a representative shall be regarded
as one who sells goods for a foreign manufacturer, but does not carry
stock in America. A sole agent shall be regarded as one who sells
goods for a foreign manufacturer or has a foreign branch of his
own, or has a sole purchasing agent of his own and carries stock
as well. No representative of a foreign manufacturer shall land
merchandise for the customer's convenience nor shall such repre-
sentative carry stock in warehouse or otherwise, except as specified
in this paragraph, unless he is the sole agent as heretofore defined.
In such case, unless merchandise is sold for direct shipment from
abroad to the customer, he shall be bound by Paragraph Twelve of
this code. In the event that a customer shall refuse merchandise
because of late delivery, inferiority, or for other legitimate reasons,
the representative shall then be permitted to place the merchandise
in warehouse for the account of the manufacturer, and/or sell such
merchandise to other of his customers.
17. GROUP BUYING
A. In order to protect American labor, the practice of sales agents
for foreign manufacturers selling merchandise to resident buying
offices at foreign value or foreign value plus cost of landing with a
small commission added, shall be considered as unfair competition
and therefore a violation of this code.
B. No samples can be shown at resident buying offices without a
sales representative of the seller being in attendance.
Should a dispute arise between a manufacturer and an importer
or dealer, it is agreed that arbitration shall be resorted to. The
National Arbitration Association shall appoint judges within the
LINEN ASSOCIATION whose decision shall be binding.
19. DESIGN PIRACY
Design piracy or the intentional reproduction of another firm's
established designs is declared an unfair trade practice and arbitra-
tion will be provided in all cases brought to the attention of the
investigating committee of the LINEN ASSOCIATION, prior to
the filing of complaints with the National Recovery Administration.
20. ENFORCEMENT OF CODE
Any infraction of this code, or of the intent of this code, shall be
dealt with by a committee appointed by the President of the Asso-
ciation. This committee shall make a fair and impartial investiga-
tion of the charges, and if a member is found guilty, the committee's
recommendation shall be deemed binding, but in no case shall it
exceed the penalties prescribed by law. Should the LINEN ASSO-
CIATION find it necessary to do so, application shall be made to the
Federal Government for a licensing system.
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