AMNISTATV AN LE& ,-HT FSY
W, eM. SO 74
... ... :. .....
: :: .
.. ........ .:: :.:.. .. : .. .. .. .
; ,... .:. ..... '^i **. :. .. .
'"" .. " .:. ;: .: i : *:"
", . : .::: : ::;.::. .. :..; :..:
:: :":' .. " ...
*" : !. :.'.: "
: ..... .. .
,. .... .. .. , i. .:: ' ..- *
. ... ..: . -
I. = '**: ".*':*: *
ii.::EiE. ",.i .. .::::. .. : .. .
.... . .. .
: : . ..- .. .... *. .
: ...... ... .. ,.:.:|: ;l|: ,.. ,. : ... :,!
Fi.../ ..", ,: ..... ,,.! ;. ,.. ,"! ",:"
:' . :' :.:. iH : : ::. :;:N::" .: i::: i: '" ".. .. : ." .. ... .....
( f' .:' ,";* '. L... " "*'::: ,. : ". d.- ." "'. ".. .:.. ...
:: ... .: :,: . .l ..... .. .:: .. :: :: ... ... *::. .. .. .
i: :, :. ; ::: , !.. ; **::: :::, *::*^i . .... ..
", .... : ":'.. ..' ...... '.. .. .W "
. . .... :....... .,fit ,,, .... . ...
I.. .. :'" ',: i. ,,.'! :: : .. . : ., : ,, ...*
*- ~~: :, L; :: m. "'::, 1 .. :
.... :" i ." .. ..:.
,,.,........ .. .. . .........H,.1,
:. .i ::: '.. :..." : : H i.: :
... '".:::: '::" -;:, ! !-. :.... : !!i : '4: i
". :.' ,.. ii.;". '! "1,.. : :,, :i,',,::
:: a :..: .. '::: 1::.. :.:1 i .H .
", ..:,. ,; ; 4.'.':,. .: H". '.. Ii
H I: E...::EEE' .~ ..'
....H H 4 ..ei.H : 'Ii. i 4 ,
t~,. r; H
OFFICE OF NATIONAL RECOVERY ADMINISTRATION
DIVISION OF REVIEW
ADMINISTRATIVE AND LEGAL ASPECTS OF
EXEMPTIONS AND EXCEPTIONS
CONDITIONAL ORDERS OF APPROVAL
Ely C. Hutchinson
D. L. Boland
W. M. Chubb
WORK MATERIALS NO. 74
NRA ORGANIZATION STUDIES SECTION
OFFICE OF iACI1ONAL l2COVEAIY ADIil11IS'tFATION
DIVISION OF iEVIEW
ADUINIS72ATIVE ANTD LEGAL ASPECTS (
E2,IPTIO1-S AiD E::CcPTIOIIS
CODE ALiEDi.i NTS
COIIDITIONAL 0LDE.LLS OF APPROVAL
Ely C. Hutchinson
D. L. Bolh-nd
W. 17. Chubb
NRA ORGA4IZATIOI STUDIES SECTION
S2 0 1940 O
This study is in effpct a series of nrelimninnry reports on
Exemptions and Exceptions, Stays, and Amendments by Mr. D. L. -Boland
and on Conditional Orders of Approval by Mr. 1. 11. Chubb. An additional
section, Part OlE, on Administration, by Mr. Ely C. Hutchinson has been
added. The report was prepared by the NRA Organization Studios Section,
Mr. William W7. Bardsley in charge.
All of the devices here examined, i.e., "Stays", "Exemptions",
"Amendments" and "Conditional Orders of Anproval", were widely used by
the National Recovery Administration in meeting and atterrnoting to solve
problems arising either during negotiations on proposed codes or under
codes after their approval. The renort deals -ith the legal and sub-
stantive aspects of the subjects, but because of limitations of time and
personnel some administrative aspects of the subjects are not covered.
Appendix No. I, in each of Parts TJO to FIVE inclusive, points out areas
for further study. Appendix ITo. II, in each of Parts TWO to FIVE in-
clusive, gives a comprehensive outline for further study of its parti-
At the back of this report will be found a brief statement of the
studies undertaken by the Division of Review.
L. C. Marshall
Director, Division of Review
March 24, 1936
Digitized by the Internet Archive
in 2013 with funding from
University of Florida, George A. Smathers Libraries with support from LYRASIS and the Sloan Foundation
hlltp: archive.org details adminis36unit
A3:' 1 ,DF CC,.T'. "iS
SUIT J.i.ARY . . . . . . . . . . . . . 1
ADIiI::I STRAT AI0_
ProceCu.,'r- As )rcc t,. . . . . . . . . . .
Tilm C.,ort Sta s. . . . . . . . . 6
Flovi C] rt ..".L- ti,..nS . .. . . .
lo;' C, irrt A en:'e.:-.ts . . . . . . 8
C.m, i,i, L.1 1D rC.. rs of A ro . . . .. .. . 9
Stays, Lxemntinr.s _~~r.w>c 'tirsz, Co .'e c.C a,.:ntz. 11
Acj.iinistr- tivc Ar -ects . . . . . . .. 12
Rec;\.,itlpstioj . . . . . . . . . . 1
Gonc.' tic,:I- 1 G'e' rs %f A r:vr i, P-v't.mbie -r ctors. 14
SCu..,. ti ..1 Or-,.e''; of iA .ov.r ., I .:.f:v':,r.- ble 7;.c ors. 15
St ,5, L::c1.1]-e tions rn i. C:&.-e A .t,"(j.iE-i.e . . . . 1C.
Chapter I lpnses of Fo-cr 21
Chapter II Dele-:t.otin of ',-- er to flt--r.t Str;'s 2?
Chapter III Definition of the tern- "Stay" 25
Ty-,es of Stn.ys 26
Chapter IV .'thocs of Lxcrcise oI St-. -.-s 23
Chapter V C:-. ses of the L:.:erci se of Po.'er to Sty -
Types of Co6.e Provisions Affected 28
Ty-.)es of Code Provisions Sub ejected to St.ays 73
Labor Provisions 33
Coc.e Aut,'Iority Prjvi ios 3os
Tr.adCe Practice Provisions
Time of Issuance of Stay 39
Retroactive Strys 42
CondCitional Stays "2
Denial of Stays 43
Period of Stay -3
Chapter VI Evaluations rnid Concli:.,ions 44
TABLE OF CONTENTS (Cont'd)
Bases of Fower 71
fei-niti.n :nd Scr.:pe of Termins "::e,. jtion" nC. "':xce-?tion" 79
Delegrtion of Power to Grant or iEny Lxcmptions and
Zxce jtiors 32
PresiCeent' s Ree-rloy.iLc-nt At reci.Levit 83
Codes tvuc'r Section 3(a) 83
Joint AAjU\ nm-7 TA Cnr'.es 34
Creation of li-rtionri-1 In'ustrial ..eC-"ovEr, Bor-rd 85
Delegrtion of Prower to Lesser Offici:'-ls 85
Territorial AC.iinistrctors 85
1iscel ri ,eou.s Dele.ti ions 86
r:e.;iona.l Offices 37
CoCe Authorities 37
Analysis of Aonlic.tions for ,"-.. Orders of :-.xe;.i-pLions
-anc' x:ce.ti-,ns C-V,.ses Ty.es C'rc.ce Provisions Affected 88
Labor Provisions 88
Wage Differentials 90
Child. Labor Apprentices 90
Tr,-Ce Practice Provisirns 91
Ceo,.rt- hical Origin of A plicEtions 92
Period of Lxertinn 93
Retroca.ctive :xem-otions 9'.
Conic -ition.l :'.ei., tons 95
TABLE OF CONTENTS (Cont'd)
Chapter IV (Conti-iued)
Recsons Denial cf '::e.. ,ti'nn-n 97
Cod'.e Acuivity es to ::c'i -ions 98
General 1.xcct.tivc c-n. A'ai..i:;tr tiv,. E:eo taions 100
re:a ition Br Co('.e Provision 101
Evaluations amn'. Conclusions 102
Chapter I Bases of P' ver 1.17
Limitc:tions a)on Pov'er of A.ioncjnent 123
Chapter II Definition ei. Scone of the Ti,. n A.,ien`-mcnt 125
Chapter III Dele.-.tiron- of' power to A, irove or
DisaD .)rove A.ienciieniits 128
Presidc-nt's Ros..i lo;Teut A';ree:aent 128
Codes Under Section 3(a) 130
Joint AAA-I3.A Cod.es 130
Creation of :Tational I/kLugtrial recovery Doard 131
Delegation of Power to Lesser Dfficiels 131
Territorial AMministr-tors 131
Regional Oifices 132
Li.,aitation u-'on Lxercise of Power Go &..er. 132
Chapter IV .iethodCs -,f Exorcise of Pov'cr of nAmecn..,ient 133
Chapter V Analysis of Amieni.dents of o1..es )-e
of CodLe Provisions Affected 135
.AmenLaents Afiectirn Applica.tion o< the Coc.e 135
Labor Provisions 137
Hour and Trage Provisions 133
Code Authority 144
Tracde Practice Provisions 146
i.iscellcneous Code Provisions 147
Chapter VI evaluations and Conclusions 149
Appendix MTo. 1. Yu.rther cese-rch U-iin-ished P!-.ases of
the Study 152
Arjendix ITo. 2. Outline 154
TA3TLE OCF CO_1TYTS (Cont'd)
Intro(.ucti. . . . . . . . . . . . .. 161
Chapter I ihr t 'c'"ers ,f : i vul o0 Cndes, o.::r. c,.e.ts
and c.iencLerc.nts ,crc c.).i'ferxi' b.. t'. Act? . r"'
Chapter II Vhat Cele-ations 'of n'.er of eq .ovwl were
made and what pev;ers ret-:i.CL? . . . . 167
Chapter III- What circ-r.strnces cttecnec thie earliest uses
ufl t-e C-evice of cous.itiowal apr1 oval of:
(a) CnCLes . . . . . . .... 1 9
(b) A. reenents . . . . .. .. 175
c) Aie .; erts . . . . . . . 174
Lj) Other mi-iinor cnministrc tive actions . 174
Chapter IV Tfl-at tte.Ipts were r'c.ie t) onibtrin Pssent of pjro-
;jo:en-,ts to cnjra.lt-ioLl rr,'erv. of a)proval? . 176
Chapter V Y.That v'cre the most frequent tie.s of conCitions
in ,rc.crs of a)r'vE-.l? . . . . . 177
Chapter VI W
Chapter VII- What evidence of con :.ir.ce or inon-co..,-lipnce
wvith conditions of .pprnval are to be found?
What was the le.:El effect of .on-cr. ,iince?. 179
Chapter VIII-CouJIL the ('.esirecL conoitioY.s hove been incor-)or-
atec.. in the ci-es tl:.e;Li.ss ;.it]-o.t "Lndae
ffic lt ? . . . . . . . . . 180
Chapter IX From al evaluaftio of' t.e ..- tricnce related
above ir-nat const'ictive r.,gge tions cr.n be Liac.e
rto ,uice ne- le;;islotisn inc. rcper' plans fr
\aLj(i1iistration t'.ic.in j ufrmn the use ft condi-
tioneal nrLders Cf a rnvrl' . . . . . 181
P '.o. 1. Unexplored Sources of t 'tc rilis 0-for jrther Stu.dy 135
7o. 2. Outline 184
0'o. 3. Details of v.rio.s types olf ci-m'itions
in orders of rp'.rvtl, coveri_.-r; ll
brsic codes of Erir co..-)etitirn.. 190
This work is composed of five "Parts" and is an assembly of so-
called "preliminary drafts" of reports prepared by staff members of the
Administrative Problems Review Unit of the NKRA Organization Studies
Section, Division of review.
The reports treat "Administrative Aspects", "Stays", "Exemptions",
"Aaenn.Tie&ts1. and "Conditional Orders of Approval". With the exception
of "Part One", each "Part" contains an appendix, thus eliminating a
AIXIINISTRATIVE ASPECTS. Part One sets forth the high spots of the
procedure whiich used tne powers of stay, exemption, and code amendment.
Since conditional orders of approval were in themselves a means, in-
cident to code approval, of staying or amending certain code provisions
or of creating exemptions thereunder, tney also are discussed.
"Flow diagrams" showing the progressive steps followed by the
organization in each type of action are shown and described. Actual
records of elapsed tines for putting cases through the procedure are
A recapitulation presents the factors as to conditional orders f
approval favorable and. unfavorable to administration and procedure,
points to the influence of numerous opposed forces, all of which were
present in the admini-strative problems of the NRA at one time or another,
and records certain other of the author's opinions.
STAYS. The stay as an instrumentality for the administration of
the National Irfdustrial Recovery Act played an izrportant part wherever
it was put into effect. It was used both as a permanent and a tempor-
ary means of meeting., reconciling and at tines rmandatorily settling
the myriad, newly-experienced- problems that developed with the ex-
perience of administering the Act.
It was one of several instrumentalities used in the same general
way and each of these is a separate part of this report. This part
deals particularly with. the legal and substantive aspects of the
adoption and exercise of the power of- stay.
Chapter I treats the bases of this power. Its delegation is
outlined in Chapter II. Chapters III and IV define the stay and the
methods of its exercise. Chapter V brings together the causes for
the use of stays and the types of problems to which they were applied,
while Chapter VI evaluates the facts found and draws conclusions there-
EXMPTIONS. In this Prrt the granting by NIRA of exemptions from
the provisions of codes is treated, especially as to the legal and
substantive aspects of such grants. An explanation and analysis of
various typos of exemptions is presented and the confusion in term-
inology between stays and exemptions is discussed.
Chapters I, II and III deal with the basis of the power of Exemp-
tion, define the scope of the terms Exemption and Exception and dJs-
cuss the delegations of the power to grant or deny exemptions and ex-
ceptions. Chapter IV analyzres the types of application for exemptions,
their effects upon dodes and the types of exemptions, such as rntro-
active and conditional. Chapter V is the evaluation of the factors
developed by the study and the conclusions drawn therefrom.
The reader is referred to "History of General Exemptions", Work
Materials No. 75, for a discussion of Executive and Administrative
Orders pertaining to general exemptions.
AENIMEIJTS. Although the power to amend codes was not definitely
set forth in the Act, it was frequently and effectively used during
the code period. Part IV of the study discusses the use of such pdwer.
Chapters I, II and III deal with the bases in the Act for the power
of Amendment and its delegation. Chapter IV treats of the methods
by which the power of amendment was exercised. Chapter V analyzes
amendments and gives the types of code provisions affected by them,
and Chapter VI sets forth the author's conclusions.
CONDITIONAL ORDER OF APPROVAL. The first executive order issued
by the President approving a code under the National Industrial Re-
covery Act -- that for the Cotton Textile Code -- was a "Conditional
Order of Approval." It contained thirteen conditions which had to be
satisfied before complete approval could be granted. Final approval
was granted subsequently by a second order.
Following that first order, a great many codes were approved by
the "conditional" method. The phrasing generally was such as to create
doubt as to whether the codes so approved were actually effective as
to those provisions which the NRA fully approved, until the conditions
in the order had actually been met. This question is one on which there
was no adjudication.
This part of the study discusses the various aspects of condi-
tional orders of approval and includes a list of such orders and the
conditions they contained.
Chapters I and II are on the powers of code approval as conferred
by the Act and their delegation. Chapter III discusses the circum-
stances which attended the earliest uses of Conditional Orders of
Approval. Chapters IV and V dnal with such matters as proper repre-
sentation of industry, assent of proponents and prevalent types of
conditions. Cihapter VI is upon the value of the Conditional Order,
administratively. Chapter VII deals with industries' compliance with
the conditions and the legal effects of non-corr)liance, while Chapter
VIII endeavors to answer the question whether codes could have been
so written as to avoid the use of conditional approvals. Chapter IX
is an evaluation and conclusions are drawn therefrom.
It is questionable whether the Act contemplated or permitted the
effective approval of voluntary codes when the order of approval con-
tained conditions not specifically assented to.
If, as appears, codes approved in this manner were really pres-.
cribed, as provided for in Section 3 (d) of the Act, there is reason
to question the authority of the Administrator to sign the orders of
approval. The reason for this is that the delegation of power to the
Administrator to approve codes specifically ex-cepted prescribed codes
under Section 3 (d)
In general, little or no attempt was made, as a controlled pro-
cedure, to obtain assent to the conditions contained in the orders
of approval before the announced effective dates. As a rule, compli-
ance with the conditions was tardy.
PART ONE: ADMIII STRATI Ol
Ely C. Hutchinson
ADI. IN I STILATIO ON
I. Procedural Asoects.
All four of the title subjects of this study were instruments
widely used by the National Recovery Administrption to meet or at-
tempt to solve problems arising in the negotiations over proposed
codes or under the administration of approved codes. The authors of
the parts of the study dealing with the particular subjects have treat-
ed especially their legal and substantive aspects. Yet, their admin-
strative use and the procedural aspects of such use are obviously
important parts of the subjects.
Stays, Adnendments and Exemptions and Exceptions were handled
administratively in fI'airly uniform fashion by all the industry divi-
sions of NIA and generally in v.ccordannce with the requirements of the
NBA Office Manual (*), after it w.s issued3 in Au ust, 1934. Prior
to the issuance of th'e mranual, proce.uare for the various administra-
tive functions was established by office orders or memoranda and this
sane practice was follo-.'ed .wnan it became nccecsary to modify the
manual instructions more quick-ly than the. new manual sheets could be
issued. Thus, the manual was never quite up to date but served rather
to record the changes already put into effect.
Using the date. obtained from the manual, modified by later mem-
oranda and sunplemented by personal inquiry of qur lifted personnel,
the author prepared a series of "flow charts" showing the procedure
for the different trpes of rctions (a*). These charts are reproduc-
ed on the next three p:r.:es in illustration ,f the manner as of April
10, 1935, in which Stays, E.-:eptions ancL Aii&nrments were handled,
according to the general practice. There were exceptions in some
divisions, but none were serious.
The broken lines used in the divgrams to denote intermediate
movements, conferences, etc. between the numerous administrative units
should not be thought of a.s representing ,\ simple and direct exchange.
On the contrary, these exchanges and conferences were highly complex.
They arose from a continuous and frequently prolonged effort of the
deputy administrator in charge of an action, to contact the people he
(*) See 1IRA Office Manual Central Record Section NRA Files.
(**) Report of the Committee for the Study of Adninistrative
Procedure, May 21, 1935. Central Record Section NRA
Code Auth An: Int.
1 1 2
Ad,.i. Off. 1--
_12 12 2J i- -
n,. ,Lab Con. L.Do I,.P
.... .... ..... ..... w ........ ......... .'V
Steos of Progress
- Legal Division
- Research & Planning
In Exceptional Cases
Emergency Stay nay be signed, "Pro tenpore" by Division Administrator.
Division Adninistrator may call public hearing.
Field investigation by Compliance,
A... ........ .
Code Auth. I
Steps of Progress
I................ ntermediate Move-
....... .. . ... .. . ..... . .. .... .. .. -. .... .. -;
4 Lab. Labor
5 Con. Consumers
-L.D. Legal Division
--- RP Research & Planning
------- In Exceptional Cases
Communicate with T. -.. Luployuient Service.
Field investiaLtions by Compliance.
Possibility of referring cases to Adviscry Council.
Emergency exemptions may be signed "Pro tompore" by Division Ad-
Division Adninistrator nay call public hearings.
May berefferred to Adrinistrative Officer in special circumstances.
Compliance Officer has authority to grant exemptions if Division
Administrator fails to act within 36 hours.
A~n- 1 n
>! ,;o 3 11
Code Azst .........
*Div. m :I
AA_ f l
SSteps of rcTe-t:
............... internediate :.ove-
- e ~. ~* -
.... . ........... ........ .. .......... V
\ Lab. Labor
L.D. Legal Division
B&P Research & Planning
In Exceptionrl Cases
was supposed to, within NRA, in order to get the views of some, recom-
mendations of others and instructions of still others and to endeavor
from all to effect a reconciliation between the views, often opposed,
of members of the industry and NRA.
As of April 6, 1935, there were nine applications for stays still
in progress through NRA which were more than thirty days old and still
incomplatc-1. The actual time thus far in process for these ranged
from 41 days to 240 days. Wo cases had been between 61 and 65 days
in progress. Three cases between 126 and 131 days; one case between
201 and 205 days; and one case between 233 and 240 days. Between Sept-
ember 1, 1934, and February 1, 1935, seventy three stays were granted.
The elapsed time for putting them through ITRA procedure ranged from
1 to 20 days and ?01 to 220 days. There were two cases in the longer
period. The weighted average time was 42 days.
As'of April G, 1935, there were in process of NBA procedure 293
cases of proposed amendments more than thirty days old and incompleted.
The actual time these cases had been in progress ranged from 31 days
to 332 days. The cases were well scattered between these extremes,
With 43 cases already 150 days or more in the process of completion.
Between September 1, 1934, and Februaary ?l, 1935, there were actually
concluded 204 amendments to codes and the time in process varied be-
tween 1-20 days and 3- 1-320 days, there being one case in the latter
bracket. The weighted average of actual completion tires was 100 days.
As of April 6, 1935, there were in process of NRA procedure 300
cases of exemption more than thirty days old and incompleted. The
actual time these cases had been in progress ranged from 31 days to
278 days. There were still in process 213 cases between the ages of
175 and 278 days. Between September 1, 1934, and February 21, 1935,
there were actually concluded 80 exemptions. The time periods for
these varied between brackets of eight in 1-20 days and one in 201-
220 days. The weighted average time for completion was 60 days. (*)
A. Conditional Orders of Approval.
Conditional Orders of Approval of codes were the first evidence
of the emergency pressure method of codification. Each industry was
invited to prepare its own code of fair competition. Those industries
commanding the greatest man-power were concentrated upon first by NRA
in code negotiations, since their codification should ;et the greatest
number of men back to work. Many provisions included in the earlier
codes were copied into the ones that followed. This was the quickest
way to get something to ,ether and since there was no NRA model code
with official sanction until November 6, 1933, (almost five months
after approval of the Recovery Act) and but few policy announcements,
the method was open to cumulative error.
(I) These figures are from the Report of the Cormmittee for Study of
Administration Procedure, May 21, 1935, Central Record Files --
At an early date doubts arose as to the truly representative
character of some code sponsors. Protests and opposition to the ideas
of committees acting for the sponsors developed at the public hearings,
sometimes after weeks of preparatory negotiation between NRA and the
Meanwhile, the declared policy of NRA was that an emergency exist-
ed and no stone should be left unturned to get industries under codes
and men back to work. Time was of the essence in all procedure.
Industries for the most part responded cooperatively. But despite
this, differences arose between NRA and industry and between representa-
tives of the same or related industries. Although most of them were
amicably settled, times came when a few conflicting views were dead-
locked and were, in the opinion of NRA, causing unwarranted delay.
The prospect of continued disagreement in these and other circum-
stances which tended to slow down industry codification, was met by
accepting those parts of the codes as to which there was accord and
issuing an order for their approval, conditional upon the acceptance
by industry of certain limitations proposed by the NRA to adjust the
deadlocked issues. An executive or administrative order of this type
was a Conditional Order of Approval.
Sometimes tne conditions had the effect of modifying certain code
provisions. Sometimes they nullified them. Sometimes the effect upon
the code was permanent and at others, temporary.
Usually the order approved the code conditionally upon the stay
or amendment of certain provisions, the providing of exception there-
from or the addition of other provisions. This procedure was generally
successful in getting the acceptable parts of a code into operation
without the delays which would most certainly have followed refusal
of the NRA to act at all until the code was acceptable in all details.
The method, nevertheless, frequently changed the status of a code from
one voluntarily entered into, to one .in which certain conditions were
imposed by NRA.
Provided that the industry to which a conditional order of approval
had been issued had a code commiittee which was representative of the
industry, the procedure generally resulted in the acceptance of the
conditions by industry and the full effectiveness af the code as thus
modified. But where the representation was in doubt, or where someone
made claim that the application of the conditions was unjust, or where
a claim was made that the conditions had not been submitted to the same
procedure as that followed for the regularly accepted provisions of the
code, effectiveness might be in doubt.
It is not intended to create the impression that all conditional
orders of approval were written with the intention of imposing condi-
tions upon industry. Yet there is only one case of record in which,
on acceptance of the conditions, a second, clear-cut order of approval
was issued. This was in Code No. 1, Cotton Textile Industry. The
first order of approval was conditional. The second was final and
It appears clearly that as a matter of procedure there was no
administrative provision by NRA by which an entire industry could be
heard on the conditions of approval made by NBA.
An approved code, apart from co-ditions in the order of approval,
had been subjected to the full process of public notice and hearing
and opportunity for all who were interested to participate in its
formulation or, at least, to offer objections. The codes which were
subjected to conditional orders of anprcval, on the other hand, con-
tained conditions inserted by ITRA without public notice or hearing.
3. Stays, Exeptions and Exceptions, Code Amendments.
A procedural application of the Stay was established by Executive
Order No. 6205.-, dated July 15, 1933, which provided that those who
had not in person or by representative participated in establishing
or consenting to a code and wio claimed that applications of the code
were unjust, should by aplyin,. within ten days after the effective
date of the code, be given an opportunity for a nearing and that no
liability to enforcement of the code would be incurred by the applicant
pending the detenninatijn of tfc-e issues raised. This provided a second
line of protection for chose who had not objecte.-. to provisions of a
proposed code in the course of the -orocedure through which codes passed
before receiving approval.
The Administrator was not given the power to stay code provisions
after a code had been approved, until February 8, 1934, although he
was given the power of approval of the "elimination" of code provisions
on December 30, 1933,
A request for a st-ty could originate with the code authority or
any interested party. It was referred to the deputy.administrator in
charge of the code involved. The deputy then sent notification of the
request to the three advisory boards, Industrial, Labor and Consumer,
and to the Legal Division and Research :and Planning Division, all of
which discussed the proposal nx,,ong themselves, and sometimes with each
other, and wrote their views to the deputy. Upon conclusion by the
deputy, sometimes following innumerable conferences and adjustments
as to the p-oro-per action for NRA to take. he would have the order drawn
with the assistance of the Legal Division, and would forward it to the
division administrator's code assistant. Then, for the first time, the
Review Division was contacted to pass upon the conclusions of the deputy
and to review them for policy and consistency. The Review Division
had its own legal staff and it was not unusual for it to differ materi-
ally with the members of the Legal Division. WVhen, in the opinion of
the Review Division, the deputy1s, conclusion or its presentation was
not as it should b&, the file was returned to the code assistant with
appropriate comment. Thence it was returned to the deputy whose duty
it then was to satisfy the requirements y.ointed out by the Review Div-
ision, provided its recommendations were accepted as being correct.
The original action of the deputy sometimes required weeks to
consummate. The second action, at the instance of the Review Division,
frequently took as long or longer if the corrections were in contro-
versial matters. Sometines this process was repeated a third time
before every vicw was satisfied or otherwise disposed of.
As the procedure was organized, there was no provision requiring
tact between the deputy and the Review Division while the deputy was
first preparing his case, so that there could be no assurance that
his action would be approved until it had been completely prepared and
When finally all the interested units were either overruled, or
satisfied, the order went to the division administrator for approval,
thence again to the Review Division, thence to the Administrative
Officer for signature and thence to the Code Record Section for record-
Except as to the number of steps required and the number of units
of NRA to be referred torn as shown by the "flow" charts above the pro-
cedure for handling exemptions and code amendments was similar.
II. Administrative Aspects.
Stays, exemptions and code amendments were indispensable instru-
ments in the reconciliation of the manifold conflicts, controversies,
overlaps of code jurisdiction, code authority aggressions, geographical
labor provision disputes and other problems constantly appearing be-
fore the administrative staff of the ITRA from almost as many directions
as there were industries and trades.
The primary business of NRA was of course the making and the ad-
ministration of codes for industries and trades. Each code had certain
basic provisions, and rules as ;o their acceptability (*) were grad-
ually developed from the days when codes were assembled largely on the
basis of provisions in or experiences gained from those already approv-
ed. Elsewhere there have been discussed the circumstances under which
the code definitions of industries and trades were written, why they
frequently overlapped and how problems of overlapping definitions,
multiple code coverage and classification arose (*).
(*) National Recovery Administration Bulletin No. 2, Basic Codes of
Fair Competition, Juno 19, 1933; also, Office Manual, Index
II-lGf-1999, Code Making and Amendment, September, 1934.
"**) "Problems of Administration in the Overlapping of Code Defini-
tions of Industries and Trades, Multiple Code Coverage, Classifying
Individual Members of Industries and Trade A report of the Divi-
sion of Review. NRA files.
Adjustments were made frequently in these types of cases by the
use of stays and exemptions and amendments. The types of cases for which
adjustment had to be made were many more than had been anticipated.
Then too, a great deal of ingenuity was used in their presentation to
NRA by industry. The NBA in turn undoubtedly suffered from shortcomings
of its own administrative concepts, organization, personnel and proced-
The wide discretion arong deputy administrators in some respects
and the lack of divisional coordination resulted in closely similar
problems being settled in different divisions, and even in the same
division, through widely differing administrative approaches. This
situation was aggravated b;' the lack of a clear definition, administra-
tively, between, for example, exemptions, stays and exceptions; amendment
pnd modifications; i-nterprtatitons and explanations. (*)
At first the term "Exemption" included "Exceptions" and "Stays"
as well (**).
Later the term "Excnptioii" was described as any ruling whereby
an individual group or class "within an industry" is released from the
fall operation of "a rcoe provision' (***)
Still later the N2A personnel was instructed that "To preserve
uniformity of usage, the term 'Exceptionst will not be used as a synonym
Sfor 'Exemptions'" (****)
The terms "amendment" 1nd "modification" were used interchangeably
until September, 193,i, (*****) after which the Office IManual permanent-
ly established the term "amnndx-ent" and discontinued the hitherto more
or less synonymously used terms of "modification", "supplement", "re-
vision", additionn" and "adjustment."
(*) See Administrative Interpretations of NRA Codes A
Division of Review report.
(**) Administrative Order X-27, May 5, 1934. NIRA files.
(**) Part III, par. 3210, Office Manual, Sept. 1, 1934.
(*****) NRA Office Manual, Part II, Index 5010.
The records show no noticeable uniformity in selecting any one
instrumentality as the proper means for reconciling problems in the
same category. They do, however, reflect an effort to keep the codes
in order as far as possible by a consistent process of amendment when
opportunity offered. On the other hand, code authorities were very
cautious about requesting amendment of their codes, since they were
aware that an opening of a code for amendment might lead to the pro-
posal by NRA that moro changes thnn those requested by the industry
Pending the working out of amendments, stays were used as a pro
temp6 re solution of some difficulties and sometimes such temporary
stays were so maintained as to have practically permanent effect.
The service codes were virtually placed in suspension as to all pro-
visions other than those pertaining to labor, by the exercise of the
stay. At other times the provisions of one code were summarily stayed
by NRA to avoid hardship in cases of overlapping codes. Stays were used
frequently to eliminate code provisions which NRA studies or revised
policy determined were objectionable.
..Cofditional orders of approval as used by NRA were subject to two
interpretations in administration:
A. Favorable Factors
1. They were effective in short-circuiting the regular
methods of code formulation, thus aiding the purpose
of immediately getting industries under codes.
2. They avoided delays in putting the immediate desiderata
of codification (minimum wages, maximum hours for labor,
reemployment, etc.) into effect.
3. They effectively closed arguments between NRA personnel
and industry representatives, featured by unwillingness
of industry to modify its position to conform to policies
B. Unfavorable Factors:
1. The conditions in the orders were frequently of such nature
as to practicr-O.lly change the code-s status from voluntary to
2. If the conditions in the order were not met, there was
question whether or not the code vas legally in effect.
(Flat Glass ILfM. Industry: Code 7o. 5741) and enforceable.
3. The method of inserting so.ie zonlitions into an order of
approval evaded (intuntiorJ.ly, or not) the processes of oro-
cudure ado-zed for voluit'--ry- code formulation.
4. The use of conditional orders if approval involved the
question of whether they were prwoerprocedure and, therefore,
Stars, Exo.mtions '"nt. Code Amendnen-s:
These instruninL-z of cr1r.inistranion w/-.re uced widely to adjust and
reconcile problem resulting front the policy and procedure of code
making. In the earlier days eacih i.s an'.lied largely according t'o the
personal ideas of the 7A official having the case in charge. There
were no general rules rigiealr regJ.ltin,- the use of each. To the end
of the code period some deoutv ad.-.inistrators differed in their opinions
as to the proper application of st,-s, eenptions and amendments to
certain problems of administration nd frequently; each could point to
existing e:xanples in suw:no .t of-his opiion. T1.rnediency frequently
dictated the selection of the instrLU.ient for accomplishing a desired
end. .'rocedure for applying, thle instruments was complicated by the
administrative practice of interposing additional checks wherever and
whenever a new uea ess or failure of orr':Liization appeared.
The author's study of the administration of I.RA in connection with
this and other reports, has engenadered some ideas which arc here re-
1. Wrapp-ed in the- oroblurm of ,'iriristering the NIRA werc
definite elements rhich v.erc opposed socially, economically
and industrially-, end fewv indc.d of those responsible for
the administration Ic-iU7 howv to relate them, or what to ex-
pect from them, i':jll enough to make the fundamentals plain
to the mcn -..,ho r-r- to make t.-e,' IIIRA a success. A few of
thes-- opposed forces v.-.'rc:
Capital and la-bor
lonopol..' "aLnd conoetitionr.
Controlled econoi:y md liissuz fair
Arricultmu'. and int(iustr'-
3Bi business mnd littl.- business
Much;.:nization and un'molo-yment
Fair competition and dcstructivc, competition
I-w industrial products and old
Seller and buyer
2. Some of th-:s-L forces %"zrL nrcst-nt in practically every
situation vwith ihich administration had to deal.
3. The objL ctiv.s of -IIA future as .ell as )rcscnt, per-
man,.:nt as t-11 as cmfrr.z;nc;:, .-:re n-ver sufficiently
known to or understood by, many of those entrusted with
the execution of its polici-s and procedure, to.procure
the ootimnu: efficiency in administration.
4. For the most part, personnel ias faithful and energetic
and Tavc' all it had in the effort to do what was immed-
iately in front of it, but many officials had little
idea what it -ias all about or the time to find out.
5 In any largo and growing organization it is necessary
to depend to a groat extent unon the juag-nent and
initiative of individuals to maintain the policies and
carry out objectives. Ho',i could this be done to best
advantage -.7hen the philosophy and many objectives of
administration were obscure and little understood?
6. The logical thing happened, namely, administration
rules were built to correct errors .which occurred be-
cause there had been no rules. Thus, while this tended
to correct previous troubles it did not prevent the
occurrence of ne'. ones.
To conclude, it is believed that this chapter upon the administra-
tive aspects of stays, exemnrtions and code amendments and conditional
orders of approval, taken together with the individual reports (*)
contain sufficient proof to confirm the statements that:
1. There wns no connrehenive plan of classification of
industries and trades upon whichh to found a general
administrative policy and coordinate the procedure
for industry codification.
2. There was no authoritative unit T.ithin IRA whose sole
purpose it was to correlate administrative experiences
and engage itself energetically in advance planning of
the procedure necessary to keep the organization ahead
of its problems.
It is not claimed that the removal of these two deficiencies
wo.ild hav- correct- d all the troubles. It wouldd however, have boon
-ffctivc in reducing the n-n.b-ir of 'robl,_ns and improving the pro-
c.dur'- and, consequently, the dispatch *it-.h which the problems re-
maininC .:.r. handled. To,: cunulativc effect would have been greater
(*) Parts II, III, IV and V hereof.
PART TWO: STAYS
D. L. Roland
The NRA Orrrnizatijn Studics Section o0 tne Divisiun of Review has
desinptecd thE subject of stays as r matter fLr separate study. The sub-
ject treats -ith the exercise -Z this particular form of administrativ-,
power by the Nqtionpl Re.overy Administreti.:n. The various problems,
quectirns, anrid difficulties pttendpnt uDon the administration of the
Ntionael Industrial Recovery Act (*) were in many instances met and in
some cases rostroned by the use of the "stay". Its use was widespread.
Its purrocEs and intents covered all phases of NBA from the viewpoint f
legality, policy, and administration.
The evidences of the use of the stey are found in the NRA files
and r, cords, from which the bases of this report reru derived. Invest-
igation of &he files fzr information relating to the various subject
headings set forth in the table of contents were made. Compilation of
the material obtained and the digesting thereof were conducted for the
main purpose of pr, senting in this prpliminarj report various problem%
which, to the author of the retort, seemed primary and important. The
investigations and the report thereof embodied herein concernca tna-
issues presented by tne exercise of the power of stay as a legislative
problem. The bases of power set forth in the Act, the reasonable im-
plicationc therein and deficiencies thereof, both real and apparent,
have been the background of this investigation and preliminary report.
This report tells of administrative action legislatively conferred
and legally delegated. The latter phase has been a further subject Sof
study and the report sets forth the various administrPtive delegations
of power and references to unauthorized uses thereof. The phases of
administrative delegation of purer which h are considered herein refer
more to the actual exercise of thu rcower in a suostantive manner rather
than administrative details and procedure. Investigations and appral-
sals of the various administrative mechanicss as to the handling of awn-
licationz, routing of paperE-s and other procedural phases have not been
A study in its entirety of the files, orders of approval of codes
and of amendments,, rnd other official pronouncements of the NMA relat-
ing to codes -hich were in so:oe way subjected to tne exercise of the
power of stey was impossible, at least for tne purpose of this report.
The study con-erns itself with the orders of approvals of five hundred
and twenty (52c) codes, (Codes Nos. 1 to 520, inclusive). In addition
a selected number of codes were investigated as to the use of the stay
where this pdministretive power was used in specific cases other than
in the order of approval of a code or amendment thereto. The list of
such codes is as follows:
LIST OF COfLS EXAMINED
Shipbuilding and Sbiprepairin __________________
(*) 48 St-'ts. 195 (hiar-inaftczr r-.forrcd to .s the Act)
Electric? I 'Mn.nufacturiing
Cca"tt auc. Suit
.w.Z-. I&'anu' ct-uring
Corset ind Brn.ssicr..
L,;itmato Pull Lj4,th DrPnDtic "nd Iusic-'l1 Theatric-?l
Lumber End. Tir..ber Pl'oduct:z
Iron and Stec'
&Ryon and Synthotic Yarn Producing
Autoimob ilo In.nufacturing
Cast Iron Soil Pi-:)
71.ll Paper MLanufacturinL
Motion Pi.cture Labor.tory
Underw ar and Allieid Proo.Lacts M_'rufF cturin%
Gasoline, P.-m Lanuf'x..ctLu'in.
Artificial Flow.r n.n;i Fcathar
Linolcumn and FElt Base Y.m.nufactu:.rin1
K.nittinr, Braicing, -.nd Wir. Cov'ir'i-C .hi.
Retail Lumber, Lrjnb r Pro-'.ucts, Luil-iv-:" i..-.tcrials
anC. Buil'.'ii-- S )ocijltijo
Laundry and Dry Cl].ning ,iW.cninty I.'. f.ctarinr
Textil .. I,'t.chine ry L-.nufr t.' trir.
Builders Supp.i ; Trd:.
Boilicr Man.-.fa c turin-
Electric Storgaj r.nL 7.t PrimE ry Batt.-ry
LUfp.gga and Fnncy Leoth. Cords
Boot ?.n1 Slhoe I,'1.u- ..ctul-i:nrg
Motor Vchiclo R.tiiiu. Tri-de
Umbrella I.nule cturring
Mutual Savings Ban':s
Com.ro ssod Air
C0.p an, Clc sure
1.> r'iing flcvic *s
Print, Varr.ish and Lacqu..: Li' ni." turr.
Business Furniture, Stor-iyc E-u p"'.mnt -?:.LI FiinE Supply
Asphalt Shin.i'- and R-,'ofinL. Lan:rfhcturit:r
Paper and Pulp
"iilsuling or Distributing Trm.dc
Schiiffli, th-: Hand Machine Dnr.b-oidcry and the Embroidery
Thread '.nd Scmllep Cutting
.n s olicck-war
Th.:. i-nvzstigp.tion "*rir.arily so',L.ht t.,: f"nor l cm.is-s for the admin-
istrativo exercise of tl. po'7cr of st.-.y ane. from the rraterial noted above
this r-port ?.ttcmptn, to sot forth scorr.D of ths reasons v.hy thc National
R.: cover, Administration, Aith.r union its ov.n initi.tivj or upon the app-
lication of s me inter st-d .'arty, c0-lrned it ncccs-ary to either grant
cr d.ny a st-ay of the provisions of a codc of fair coumotiticn. An ana-
lysis of c:d- provisions subjected to sta.ys has be.:n mado, with particul-
ar stress bcing lai2 upon rmaximtum hours end minimum wage provisions, code
authority provisions and tradc -p-)ractice rules. The author stresses the
pr-li..nna-.-" nature 1.f this r-port .-.n tht inability to e:xhaust all re-
cords, but intends to set forth as e result of the study already made,
some ans'-.'r to the question "What did UEA do with regard to the use
of the poaer to stay cod, provisions?" and from the answers thereto,
to subr.mit srugjstions and conclusions for lcEislativc purposes and con-
14.SES OF POU.'ER
The Act vos an irov*-d by the President of tne United States on June
16, 19335 An exaninati-n of the provisions of the Act discloses no use
of or reference to the7 ord "rtay", but throughout the Act there are
sufficient legislative declarations which warrant and justify the use of
the Dower of stay. The theory of the Act was a delegation of power to
the President with certain limitations muon the exercise thereof, which
delegation required an exercise of administrative discretion as a means
of orooer acuministr,.-;timn of the Act. Section 3 (a) of the Act contains
pertinent language regarding the exercise of the power of the stay. Cer-
tain stan&dr'ds and requirements v-era i posed upon the President as to
the approval of codes and the cection further provided thr.t where the
codes affected persons, the President could, as a condition of his an-
proval of a code nrovido "exceptions to and exemptions from the provi-
sions of such code." this tnhr.ught of a poner of discretion in the Presi-
dent obtains throughout ithe Act. It is found in Section 10(a) in which
the President was a atnorized to prescribe rules rnd regulations and in
Section 10(b), waich auth.rizcd the President to
"cancel and niod.if:, any order of approval, license,
rule or regulation issued * i"
In view of these s-oecific references in the Act to the Dov'er of the Presi-
dent to make exemptions and to cancel or modify his orders of approval,
it is unrues.icned that the Presid.ent in the exercise of this power and
the discretion granted to him wa3 permitted to stay the provisions of the
code if he found tha-it such action would effectuate the declared purposes
of the Act.
The Act -orovides for various kinds of codes other than those sneci-
fically mentioned in Section 3(a) (*) but attention is directed to the
statements in these particular sections that the approval of these vari-
ous ty-?es of codes or agreements v'ould have the same effect as a code of
fair coi-oetition approved by the President under the provisions of Section
3(a). The power conferred by Section 3(n), 'vhen coupled with the gen-
eral grant contained in Section 10(b), is of sufficient latitude to anoly
to all Corms of codes and agreements authorized by the Act.
The o'-i;er conferred mon the President to grant or deny stays was
by the terms of the Act rather general. Limitations were imposed, but
the ambit of administrative discretion was of wide ranre. Section 1 of
the Act set forth the declared policies end -ournoses of the Act and the
President was empowered to exercise this right of stay v'hen "necessary
to carry out the ournosed of this title". Section 10(a) states:-
)(*) See Sections 3(d), and 7(c)
- *'.1 -
"Iic the Presidint in his li-crr tin is nC siry to effectuate
the policy herein d.-clared"
Section 3(r) nre-cribes:-
"for the protection of concjuimors, cointitors, employees and others"
"in furtherance of the 1nublic interest"
The operation --.nd effect of a st,"y, is similar to thnt of an exemp-
tion. The author has nre-oared a reoort on the latter subject and has
considered in detail the bases of noe.,er for the use of this latter men-
tioned formn of administrative relief. It is suwested that reference to
the report on Exe'intions (Chaptcr I Bases of Po-7er) will show authority
for the statement contained in the foregoin oara, ;ra-ohs. For -purnoses of
brevit:, and avoidance of duplication the co:tent of such chapter has not
been set forth herein.
The reasonable i,.rolications in the Act convey the existence of the
power in the President to anurove r code or not or to anprove part of a
code, to ii-oose limitations or exceptions or modifications union the opera-
tion of that code. This nower connotes the mrneaniag, purpose and effect of
a stay and as such the use thereof by the President or any official to whom
this uower nrs bee., orooerly deleog.ted is within the scope and extent of
the legislative declarations contained in the Act.
DEICGATI 0: OF POWER TO GJAWTT STAYS
On June 16, 1933, the date union which the Act was signed by the Presi-
dent, General Hugh S. Johnson was aonnointed by the President to be Adminis-
trator for Industrial Recovery. This Presidentinl Order authorized the
Administrator for the ensuingE; thirty days to do such- "other and necessary
work as authorized under Title I of the said Act". The Executive Order of
appointment elso aopnointed a Special Industrial Recovery Board composed of
the Secretary of Commerce as Chairman, the3 Attorney General, the Secretary
of Interior, the Secretary of Agriculture, the Secretary of Labor, the
Director of the Budget, the Administrator for Industrial Recovery and the
Chairman of the Federal Trade Commission. The authority conferred upon
General Johnson was made subject'to the general approval of this Board'(*).
On July 15, 193., the jower originally Lranted under Executive Order No.
6173 was continued with certain limitations (**). On the same date
(July 15, 1933) the President set up a regulation and modified any pre-
vious Executive Order inconsistent with its terms. This regulation is as
"Any code of fair co:-netition a-proved by me shall be deemed in full
force anr' ciflcct on the effective date as stated in the code; but after
(*) See Executive Order No. 6173
(*) Sec Executive Order No. 62C5-A.
the apnrovel of a code and as an incident to the immediate enforcement
thereof, hearings may be given by the Administrator or his designated
representative to 'ersons (hereby defined to include natural persons,
partnerships, i-rs.ociations or corooritions) who have i-iot in person or by
a representative particio"Lted in establishing or consenting to a code,
but rho are directly affected thereby, and r'ho claim that anplications
of the cor.e in irrticular instances are unjust to them and -ho apply for
an exception to, or exertion from, or modification of the code. Such
-oersons so ano' living, within ten days after the effective date of the code,
shall be given an opportunity for a hearing and determination of the is-
sues raised *)rior to incurring anr li;.bilit-r to enforcement of the code,
and the AC-i '-istretor shill, if justice requires, stay the application of
the code to a.l s.i.ailarly affected ending a determination by me of the
issues raised." (*)
The substniace of the above quoted Zxecutive Order specifically conferred
uvon the Administrator the oo--er to stay the application of a code uoon
the receipt of an application for man ex-cetion therefrom, not only as to
the person wTho m de the arolication, but also persons who were similarly
affected. This Executive Order makes th.i first reference to the use of
the term "stay" and is the first s ecific delegation of power from the
President. On December 30, 3933, the Precident delegated to the Adminis-
trator for ITdustrial P.ecovery the po-,er of aooroval of the "elimination"
Sof any one or :iore provisions of any code of fair competition. This order
also permitted the A&ministrrtor for Industrial Recovery to approve excep-
tions from the provisions of a code (**),
The power granted to the administrator to act on a-pplications re-
ceived within the time oerioct set in ZExecutive Order Yo. 6205-B restricted
the proper and efficient use of the s ty. On February 8, 1934, the Presi-
dent, by Executive Order 1o. 6590-A, authorized the Administrator for
Industrial Recovery to prescribe rules and regulations covering stays and
other forms o--f' relief front codes of fair co-inoetition approved under Title
I of the said Act, This order extended the oo-ier of the Administrator in
such a na-nner 29 to permit tie use of the stave after a code had become
Effective and did not restrict the use of the oower to orders of auorovS.ls
These oo',ers which had been conferred uoon the Administrator were b7.
the terms of Zxec-utive Order Fo. G859 Se-otember 27, 1934, transferred
to the liationrl Industrial Recovery Borrd, which Board, by its Adminis-
trative Orders, authorized the issua-nce of orders of approval ryhich nec-
essarill- included orders of s taay b", the Administrative Officer (***)
No further delegations of porjer to use the story were specifically
made. The o',-er to stay provisions of cQde$ as such was peculiarly con-
fined to the AiLL.niuitrp.tor andC the lictional Industrial Recovery Board,
(*) See E:xecutive Crier Fo. 625,3-P
(**) E.ecutive Order 6543-A
(***) See Ld-iinistrative Order X-93, September 28, 1934
hone-ver, thi.; .utihod of adninistrctive lictinn ':z s useu- in some instances
by les-.-.er of icic-ls of tnE 1:--tinnal Rico-:er-' ._-uiiistr .tioa, The o,-,er
of tnrov. .1 of co-e ex.-notr)ions., exce itions, rnd such forms of a-dminis-
trative rclie.' ere from ri-e to tine cele- ted to le.-ser officials, the
exerci"c o "'..ic. r-eoiired acuinistr tive d, creation. Option findings,
nrotests, policies -nd other consii.erntions res.ilted in an administra-
tive st, -- of the intended relief, P'o for-" --f "ri'teri dele1Lation of this
pocr .*v .',.Le .U' the i'se thLiereof '-ns co'-:si,' ered i olie,, alid contained
in th.e o'.er c-' exe'.,tion rc itcd b'i" the .,di'-ii-:t rrtor or the rational
Industrial 2-ecover,' Bo,:rd to the -tLrticiil]r officer.
Ac.iinistr;.tive action hl-. rl,'', lresertecl the question of due
process. For ".',r.omses o, tire-t--"vin : an.. e.-'.edienc it being -nracticc.ll'-
imposs ibl'oe to conduct he.Lr'irLs uJor. all matte-rs sub-itted to the Adminis-
tration, the mi-iiniz.trator set uo tne procedure ': o'-n as "notice or oppor-
tunity to be heard". The onerrtion of this To'oceuiure resulted in the ad-
ministr tive ao--roval of a particular matter with a ten, fifteen, twenty,
thirty, or sict,-d;vr stay of the o'serztions of tihe provisionss of that
uartic-Jlrr -atter in order that interested *;ersonc mi-it, if they so
wisheri, object. This po'7er, 7:hen used by tie A-dninistrator or the Ka-
tional Industrial Recovery Board, uaz in accordance vith the Presidential
deleit.tions hereit fore menticnei, but r;hen useCL b' lesser officials of
the National -ecover' Adninistra.tion was in accordance vith implied -oorer
which accom.-nnied the particular delegrited porer rather than according
to soecificall"- delegated authority.
Thie President'sc Lce.rTe,l?-n'wt Aj.-reement provided in Pora.-rath 14
thereof for v sta'- of tS rov'ions thereof iendinr a summary investiga-
tion b"r the i:ational Rccc-er-r Au-inistration (*). Tne official exolana-
tion of the PT, (**) mc'k;- reference to Pn-:a.-raph 14 and in the exolana4
tion t wreof states thit inc.iviLual employer may mrhake application for
a stay i.'. accordance 'itn th'e provisions of Para-raoh 14. Interpretation
No. 2, concerning Para-raih 14 (***) sets forth the n-orocedure and its
effect as r temporary stay -ith.ut further investi:-.tion pending decision
by IMRi, Thie interpretation states th.,t Par;a:ra)h 14 is not intended to
provide for .roup exceptions, buc. onl" to meet ca-.ses of individual hard-
ships. This re-oort does not concern itself 17ith applications submitted
to NBA i-. accordance '-7ith the provisions of Pnragra)h 14 of the PRA. It
is true the '-ord "stay" is used in this )ararao-h, 1but in vie-' of the
fact that the oara.raoh is limited to cF--es of individual an-o-olication
the con-ideration of these applications are found in the IIR-. Organization
Sections Stud- on Exemptions. To other Presidentia-l delegation of norer
to sta"- the operation of the Prt is fund.
(a) See R-RA Bulletin i o. 3, July 2C, 1935.
(*-) See .+ Builletin No. 4
(*s.) See -" Bulletin No. 4
fE?-TNTTION OF THE TE .i "STAY"
The 7ord "stay" in its ordinary meaning is a "staying or stooping,
or state of being stayed; suspension of motion or progression, a halt,
stand, sto_-, ca. stopping, or iore usually a suspension of procedure or
execution by judicial proceedings or executive mandate". (*)
The term "stay" in its legal sense nrs nany. connotations. It relates
to such things as a stay of foreclosure, a. stay of court proceedings, a
stay of an action of l-w, and Acts of a legislature prescribing a stay in
certain cases set forth in the legislation, a stay of execution (**).
As stated above, there is no reference to the term "stay" in the
National Industrial Recovery Act and at the beginning of the Administra-
tion of the Act no administrativedefinitions or explanations of the term
were issued. Chapter II refers to the use of the term "stay" in Para-
granh 14 of the PRA. This reference ras one of the first occasions upon
which the term "stajs" wacs used b-: the Administration. The fact that the
interpretation of this parc:gre-ph made it cpoly to individual cases showed
a disposition upon the part of the Administr-tin to make the term apply
to individual aop-ilicat-ons for relief. As the Administration of codes
and of the PPR. continued, reference to individual applications was made
,by the tern "eremption'f rather than tie term "stay".
Early in the process of code formulation, the Administration found
that for purooses of enforcement of rolicyr or recognition of protests it
became necessary to star, in the order of a'orov2l of a code, the actual
operation of oart of the provisions of that code, either permanently or
for a limited period of time. The use of this method of administrative
power resulted in the reference to the term "st ay;", which reference was
actually confined to orders of approval or modifications thereof. Later,
experience in the administration of codes disclosed the necessity of ex-
ercise of the ;po-er to stay provisions of codes already approved, either
upon application to or initiation by the 1iP. Consequently, the use of
the term 'lsta;'1 was enlarged to include modifications of orders of appro-
vals of codes. The meaning of the term "stay" was that the stay affected
all members of an industry or recognized divisions, either geographical
or industrial, and that an, exemption applied to a single individual or
group of inc'.ividuv.ls.
No administrative definition of" the term "stay" was made until May 5,
1934, when the Administrator for Industrial Recovery, by Administrative
Order X-27, issued rules and regulations concerning the modification of
and exertions from approved codes of fair competition. In Paragraph 1
of such Administrative Order it ras stated that the term "exemptions"
shall include exceptions and stays and all rulings whereby an individual,
(*) Websterls Ne7 International Dictionary, Merriam Edition, 1934, P.2037
(**) Volume 3, Bouvier's Law Dictionary, Rawlets Third Revision P. 31-35
- 26 -
grour, or cla-s is relcan.:e-d from the full o-)er?.tion of a provision of a
code. This definition partially confirmed the already existing unoffi-
cial definition mentioned above and no change thereof was made in defi-
nition until the i-',unfice nf the iUTA O0 .ice. :'.nul in Sentember 1934.
The Office ::'ual states, in Port III, p. 3210:-
"The ter: 'stay' includes ny ruling w-'ereby an entire industry is
released from the full operation of a code u-ovision, (i.e., whereby
a code -)revizsion is te!rr)orarily suspended)."
This subsequent definition restricts tha score of the term "stay" to an
entire industry, but stpys issued after thin official definition applied
both to an entire industry and subdivisions of an industry, so that the
original unofficial intention of the npnlication of a stay actually per-
sisted. In other words, the use of the sta4 would be invoked for the
Construction Industry and the Painting and Pa-eerhanging Division of the
Construction. industry, whereas an "exem-tion" applied to a single indi-
vidual or group or class of individuals. The meaning of the term and
the a'rove mentioned limitation as to its application has been taken as
a basis for the research conducted for purposes of this report and the
results obtained from an analysis of various stays will aply only to
those stays which were issued against entire industries or recognized
Anrexamination of the records of the various stays issued by the
Administration discloses widespread interchangeable use of the term
"exemption" and the term "stay". The provisions of a code would be
stayed as to a single individual and an entire industry would be exempted
from the provisions of the code. (*) The interchangeable use of these
terms resulted in great confusion as to the nature of the administrative
action taken. It is true that the result of the action was the same, but
this administrative division had been set U' and, of necessity, required
separate treatment. Delegations of rower differed as to these forms of
administrative action. This fact requires more strict adherence to the
defined classes of action. As a matter of record, exemptions were found
which were in fact stays with the reverse situation equally existent.
The files were equally disorganized. Proper classification of the records
has been atteiipted, so that this report will be based upon evidences of
"stays" as defined in the foregoing paragraph.
T7PES OF STAYS
The scone of the use of the stay varies as to its extent and appli-
cation. The first type is known as a General Stay one which stayed all
of the provisions of a code and apnlied to all members of an industry.
This form of General Stay was utilized very rarely at the time of the
original code making. (**)
(*) See INRA Orders 72-13, and Order 259-37
(ins) See order of aoproval of the Millinery Industry Code (Code No. 151,
December 15, 1933) and order of approval of Spice Grinding Industry
Code (Code No. 424, :lay 11, 1934)
The use of the General Stay became more ridesnread during the period of
administration of codes, particularly vith respect to the orders of ap-
orovals of a.mencdments, iny number of amendments of codes were approved
with a sta' of the onertion of the unendment provisions for a specified
period of time. The stv applied to all members of the industry and ap-.
plied to all of the terms of the amendment. This form of stay was used
particularly in connection with satisficstion of due process require-
Another form of stay was one which r'as general in its extent as to
code provisions covered, but limited in its application to members of
the particular industry affected. This tjone of stay was used on many
occasions in the order of approval of a code and r7as also used at the
time of the order of a-o-oroval of rn amendment to a code.(**)
A t"rpe of st.-y issued by the AdJ:,inistrrtion was specific as to the
extent of the code provisions covered and general as to the application
to members of the industry or trade affected. These t.ypes of stays were
found, both in orders of aipporovals of codes and amendments. (***)
(*) See the Ice Industry Code, amendmentt 1, Order 43-1, April 24, 1934;
Metal Tank: Industr-r Code, Amennment 1, Order 1H4-1, August 2, 1934
(**) The order of aunroval of the Dres-' ,r'.nufacturing Code (Code No.64-
October 31, 1932) stayed all of thLe provisions of the code as to
manufacture of dresses whose chief content vwas cotton, both house
and wrash, pending further hearing. The order of E-pproval of the
Knitted Outer-eer Industry CodCe (Code -Io. 164 December 18, 1933)
stayed all of the provisions oC the code an to manufacturers of
knitted outerwvear for infants Lnd children, sized from infancy to
age 15, until determination of their inclusion in the code,
(***) In the order of the a nrovol of the M.edium r.nd Lo" Priced Jewelry
Il.air.f.cturing Code (Code !.o. 75 December 23, 1933) the provision
of -;.":rent of time and one-third for .all hours over forty (40)
hours ier vveek to all emrnlo-:-ees r..s stayed until March 1, 1934.
In the orc.er of approval of the Fir.- Manufacturing Industry Code
(Code o. 352 :'.rch 31, 1934) the homevork provisions in that
code .ere stayed for a period of thirty davr, the effective date
of the code. In the order of approval of the labor provisions of
the Brewing Industry Code, the said provisions were stayed for a
period of ten days,.
Another form of st.v is found one which tw, snecific as to its
extent in corn.oecti .n with code -rorisin:- .n. also ; r to its application
to memi.rs of industry. (*)
uraPT 7 1 V
I:ETIHODS S0 ':-JCIS: O0 S'.YS
Toie ase nf the ooner of story "-mFs evidenced in various forms of ad-
ministrrtive action by, the NFla. 'The President, on La,,- 26, 1934, by T-
ecutive Orc.er ,'o. 6723, staved all of the provisions nf the codes of the
service trades and industries except certain labor provisions. This is
an exa;.role of the exercise of the no'.7er of general stay by the President,
Likerise, the -.orer of general stay nw.s exercised bv the Administrator
in Admipiistra.tive Order X-5, of Febrc.ar', 2, 1931. The oierrtion of a
prior rc-.6ii.Aitrative order (AOuninistrative Order X-4) wvas staved for a
period of thirty, days and later this same order ,"as *ernanentlv stayed
by administrative Order X-8, dated Larch 3, 1934. In addition, the
Nationci. Industrial Recovery, Bo; rd, ir. Administrative Order X-136-2 starred
th3 o-eration of Pararaoh 2 of Adi-inistreztives Order X-136 insofar as
it related to the code authorities or asgencies thereof rhich were soeci-
ficall" set -orth in the s.id A'iministrative Order X-136-2.
T'.e Adninistrator exercised the power of the stay in orders of ap-
provals of codes, amendments, Pnd other miscellaneous matters. The e.d-
ministrctive use of the sta- also is evidenced inseoarate orders issued
to exte.i.2, terminate, or modif-' a stay theretofore issued. On some oc-
casions V soe).-rate order was ,issued to stay some or all of the provisions
of a code i-'..ich order, "-as not linked -'with an order of approval of a code
or an an.endinent, but a sep-arate and distinct exercise of the "oower to
CiUSES OF THE ECXh.CISE OF PC'-ER
OF STAY TYPES OF CODE PROVI-
A:'-inistrrtive action, such as a stay, ma.vy be m-ade for one or vari-
ous reasons. Primarily, its our)ose is to .fi'orj relief from the equal
application of code provisions; to enable the administrative agency to
maintain control of and adherence to its rules and regulations; and also
to prevent the approval of code provisions which are not in conformity
(*) In the order of approval of thle Insulation Board Manufacturing Code,
(Code 'o. ,o3 Maarch 22, 1934) the .p"olic-tion of the vage and hour
provisions was stayed as to the territory of Hawaii. In the order
of %-'-,roval of the Cotton Textile Industry Code (Code No. 1 July 9
1i35) the -provisions relating to limit.-Atin of machine hours were
st'_.e insofar as they applied to the production of tire yarns and
f.-tric for rubber tires.
with leCal requirements or declared polic,-. The National Recovery Ad-
ministrction -'az presented with problems necessitating this form of
administrative action. Some sponsoring groups submitted codes contain-
ing illegal n'ovisions. Attempts of the Administration to cause a dele-
tion of these objectionable provisions often were of no avail and in
such ct.ses the use of the -oorver of stay was necessary, in order to ?rop-
erly prove the code. In Sd(Lition, the Administration, being presented
with the -jroblem of codification of industry end trie necessity of admin-
istration thereof, naturally announced various policies which were de-
signed to curry out the purpose of the Act under which the program was
progressing. Oftentimes code provisions us submitted did not conform
to the announced policy end for pur.)oses of consistency and adherence
to this policy- it becsmie necessary, inon the part of the Administration,
to exercise its power of stay.
The KUA, in its administration of tha Act, which involved the is-
suance of rules and regulations having the force end effect of law, nec-
essarily v7,s -)resented .7ith and otlired to follow due process require-
ments. In the early.r stages of tne codification of industry, all of the
proposed codes were submitted r:nd consiC.ered at a public hearing. As
the details of administration increered. with respect to amendment of
codes, interpretations, exermtions, classifications, Code Authority
rights and obligations, end other mutters, it -as found to be a practi-
cal impossibilit'r to s,LTlit all of these matters, many of them routine,
to the for-a.lity of a 'public hearing. The recognition of this practical
imroossibilitr resulted in the set-un of the -orocedure commonly referred
to as "Notice of 0.'oortunity to be heard". This particular form of
notice involveC the use of the rower of sta-y. An order was signed re-
lating to the -porticul-r matter, but the oreraticn thereof was stayed
for a specified period d.urin; r-hich interested otrties could object to
the effective o-,eration of the particular matter approved. This form
of stay -'as extensi-.voly used by the administration.
Tha investigation of the records of :iRA relating to stays was con-
ducted ,.lov.ig twro lines. First, the orders of aoirrov'ls of codes (1 to
520 inclusive) were examined and the orders of approvals of amendments
of such codes were also examined. Second, the records of the following
Alui -inan Graphic Arts
Asohalt Shinrle end Roofing Ice
Automatic Snrinkler Ladder
Automobile iLanufrcturing- Lime
Automotive Parts and. Equipment L-umber .nd Timber
Bitum inous Coal M.en s Clothing
Boot aa-.d Shoe MIen's I1eckwear
Builders Su-o.ly Trade Liillinery
Business Furniture iLiotion Picture
California Sardine Processing Motor Vehicle Retailing
Can manufacturers Oil Burner
Caaned Salmon Paint, Varnish & Lacquer
Cer-oet and Rug Paperboard
Cast Iron Soil Pine Paper and Pulp
Ci,..'r : u',an-.'cturin;
Coat a,:ic Suit
Daily -se'.saper Publishinf,
Dresc L ufacturinp.
Fish*er-" (Basic Code)
Floor W'.I Clay Tile
Gas Akxliricc and Apparatus
Glass Co-te iner
Rayon and Synthetic Yarn
AI!ioer Tire IvManufacturing
Set Up Paper Box
Shipbuilding and Shiorepairing
Iron and Steel
were examined for the our-oose of determining whether or not a stay had
been issued Ft a time other ticn the time of the order of approval of
a code or C.nendment. The codes e:-amined disclosed six hundred and fifty-
four (6-4) orders which contained a stay; five hundred and ninety-eight
(598) of such stays were a -cart of orders of approvals of codes or amend-
ments ant' fifty-six (56) orders of stays were issued at a time other
than at the time of the code or amendment approval.
The orderc were examined as to the particular code involved, pro-
visions stared, and the reasons for the issuance of these orders. A
classificatio: of the ?rcblems presented shows the general causes for
the issu-ncc of stays hereinbelo'v set forth:
Recognition of protests
Leh.a i ty
ecessit-, of further study
(a) by iBA
(b) by industry' or trade
Industrial subdivisional problems
Si::tee.. onrjprs of approvals of codes stayed the operation of the
codes in entirety for various periods of time. (*) A few of these
stays -.->lic'. to certain t7nes of manufacturers; e.g., the order of
( S) See orfer of approval of the Coffee Industr, Code (Code No. 265),
the Fisheries Code (Code I'o. 308), mayonnaise Code (Code No. 349),
Peanut Bhztter Code (Code No. 378), Spice Grinding Code (Code No.
anoroval of the Dress Manufacturing Code (Code No. 64) stayed all of the
provisions of the code as to the manufacture of dresses whose chief content
wa..s cotton --ending further hearing. The order of approval of the Knitted
Outerwear Industry Code stayeed all of the provisions as to manufacturers
of knitted outerwear for infants a.nd children, In somq cases the code
was approved for a triel period and sta':ed in its entirety after a cer-
tain specified date for ou-rooses of further study or amendment, as in
the orCer: of a-rroval of the Millinery Industry Code (Code No. 151) which
stayed all of the provisions of the code si:: months after the date of
the order ending submission of reco.mmendations regarding continuance
or amendment of the code. SCa:s of all provisions of codes were issued,
either at the time of the order of approval or subsequently, when objec-
tions and protests to sech provisions were recognized". (*)
The Adminirtration issued a number of orders of stays of amendments
and the records investigated for the purposes of this preliminary report
show the following:
Stayvs cf rmendrqnts ----- lD.bor ------- 13
St.' 1rs of amendnents --- code authority --- 85
Stv'rs of amend-ents --- trade practices -- 34
The entire operation of an .Frendment uas usually stayed to meet
due process reouirerments. (*) In some cases amendments were stayed for
reasons other than jue nrocecs requirements. (***)
On some occasion the aj-lication of a code was stayed for the our-
poses of effecting P consolidation of thr.t poartic'-lar code rith some
other code. (**4*.)
Frmr tine to ",iire c.ila..sification nr:)blems arose which vwere caused
either by ,ulti-)i cc'i coveir'e or overiL.oing definitions. The pro-
blems created often ie5ulted in stay of a code provision insofar as
certain operations unaider tlat code ,'er-. concerned, or insofar as certain
members of the industr7r subject to that code were concerned. In the
(*) Sea Administrative C'rdcr 17o. 480-4 which stayed the operation of
the Structurr-l Steel and Iron FCbricating Code indefinitely and
without the as:3nt of the industry. See also order of approval
".LcL.roni Code (Code Yo. 234).
(**) See Fabricated e.tal Products Code 1-o. 84, Amendment I'To.1; Retail
Farn Equioment Code ITo. '197, Amendment ITo. 1; Printing Equipment
Code -,o. 257, ASmendinent 17o. 1.
(***) See Cotton Garment Industry Code !io. 118, Amendment No. 15
(****) See Uire Reinforce-ient Code, the provisions of which were stayed
for the purposes of considering consolidation of the Iron and
Steel Code; the Cleanser iZhnufacturing Code was stayed for pur-
ooses of consolidation with the Soap and Cleansing manufacturing
Code; end the Langanese Steel Casting Code for the purposes of
consolidation with the Steel Csting Code.
Oriental Ruw, Ir-oo-ting Code T. .1-7, Supplem-nt i'o. 1, the order stayed
the provisions of the Wholesale and" Distributing Trade as to Wholesalers
of oriental rt-as in order to permit o-)eration under the Importing Trade
Code. T,,ese classification problems often arose in connection with
territorial -roblems, esneciolly v;here senL.rate territorial codes were
being considered. (*) Lik.''?ise st-,,s -ere issued because of overlapping
code definitions. (*s)
A nr-!iber of orders of e-.revels of codes embodied administrative
action, w;.ich -.as in the nature of a stay, but "-ere more sweeping and
decisive thrn. the ordinary form of sta"-. :hese orders by their terms
"eliminated" provisionss from codes .-nnd usually 7ere invoked in cases
where the articularr provision r.rn counter to legal obbjections or were
not in confornitv vith the announced 'olicy of the Administration. The
effect of these orders not only stayed the operation, but rendered the
particular provision null and void arnd deleted it from the code. Admin-
istrative policy announced that the so-called "merit clause" relating
to the -ororiotion of emoloyees and increase of wages on a merit basis ras
against policy and in several ca:-es the merit clause set forth in the
code was eliminated. (***)
Provisions affecting the rights and obligations of code authorities
also felt the effect of "elimination."
Administrative objection to Admainistration members of a code autho-
rity being avonointed without expense to the industry was found to be
objectionable in the Foundry Equipment Industry Code No. 264, so the
order of a)proval "eliminated" the nords withoutt expense to the indus-
try". In the saxne code labor policy objected to an exception from maxi-
mum hour )revisions which included members of the staffs of executives,
executives, and other specified emplo'rees. The recognition of this
objection resulted in elimination of the terms "members of their res-
(*) See Or-'er io. 446-4 relating to persons engaged in canning pine-
aPn)le end can manufacturing in Hawaii. NPA files
(*s) See Or.ers Nos. 287-2-A and 288-2-A relatin: to conflict between
th? e'-s-aper Publishing Code and the Grr.phic Arts Code. NRA file's
(** Sei Orders o- arorovals of the Boiler Lanufacturing Code No. 38;
Boot and Shoe Industr,', Code) No. 44; Hotel Industry Code No. 121;
O-'c.cet',rlene Iniustry Code '~o. 155, and the order of ap-nroval of
the Bituninous Qoal Code I'o. 2-, where a "weighing" clause was
eliminated. 1MA files
(*sss) It shmo'ld be noted that this order eliminated -Darts of a code
nrovis'.on rather than the entire provision itself. For a re-
co'-r.itlon of objections to labor o-rovisions, see also the order
of F-a.-roval of the Steel Joist Industry Code No. 495. NBA. files
Trade practice policy oftenrl required the exercise of the nower of
elininoticn rith respect to trade practice provisions (*) All of the
above e::amples contained clauses or -)ortions of clauses whichh if per-
mitted to reLuein in the coda would have conflicted with legnality or t.e
policy of the Adrinistration relating to labor and trade practice oro-
visions, '-3A insignia. anm the like, and as a result, this oo-7er of
"elimination", which -E-s in the nature of a stayr, wtas exercised by MRA.
TYPES 07 CODE PROVISIOS SUBJZCTED TO STAYS
The use of the power of stay covered oracticcllr every t-,ype of
code provision submitted to URA labor, code autioriti, trade practice
and general provisions.
An examination of the code provisions stayed, discloses some rather
interesting information., The use of the nower of stay ',r the Adminis-
tration was "ost usu.all aoolied to trsde practice provisions, and in
a lesser degree to labor provisions of codes. Cf the latter, the maxi-
mum hour and minimum "',re provision of codes were the ones most usually
stayed, bbut the various general la-.or provisions likewise met with the
exercise of thi. administrative novur, Tabulation of the records in-
vestigated relating to lr'bor provisions sho.-s the following:
(*) See order of approval of the Horseshow an,3 allied Products Code
No. 325 (.)rice list provisions); Bulk Drinking Straw Industry Code
ido, t31 (uiiaerseling clause); Beve"ro, Disoenser and Equipment
Cocle io. 324 (sa.r:s con-trzirv to jublihIed price list clause); Onti-
cal Uhioles&J.e Co'L'e o. 443 uniformi rtscounts); Fetal Hat Die and
T7ood Eat Block Iuda.tr;r Code Yo. 221. (clauses regulating the use
of -_Az irnsig:nia) Cigar Container Inrdustry Code Io. 135, Amendment
No. 1 (Code Authority contributions clause). i,A files
STAYS 2-_ L LBOkW ROVISIr.S OF CODS ()
TYP7 0 COD- 2-T.OVISIC! NO. OF STAYS
Minimum wa..-s 22
M.inimunm r'r-e.; (,reo'ra-ihical r.) ----------- 4
Lini'min ":.r'c industriall suibdivizic.n) ------- 4
Maxim.um h ur.------ -- ----------------- 23
Maxci muin .. urs (Ceo-.ra )hicz: i .rea) 1
Maxim-mn h'a.-'us (Industrial subdivision) ----------- 3
Definitions of t'roes of empnlovy.es--------------- 2
Home vworkc orvi:-ions 8---------------------
Child labor -rovisions--------------------------- 1
Piece rate .-------------------- 1
letho l of p.-;.:nT'nt of -c-,-es ------------------- 1
Handic0) jed r,-or!-ers 1
Equitable adjustmentt of vrraes ------------------ 1
Most of the stavs o." the m.xiarun hour r-nd minimum nage provisions
were nace as a result of protests b-r interested parties, either the
wages r:ere too 1'i-h or too lo.7. This fact is i.imore strongly borne out
by the ajove table snowing administrr--tive recognition of difficulties
as to geogra.'"ical sections of an industry -nd also industrial divisions
thereof. The stovs of home rork provisionss were the result of labor
policy as anilouncea by NRA, ns were the "eliminations" rhich '7ere mostly
deletions of the so-called "m3rit clause". All other stays of labor
urovisi, is 'ere granted because ? of exceptional conditions existing in
the iildustr- and the need for r;nrticular relief from the operation of
the oarticulir -.,rovisions.
CODE AUTOI.-I0fT PROVISIO:iS
.hen the President issued en-'orcenent of an order of approval of
a code, orobleimir in its dminivtrc-tion -ere e:oected and, as the codi-
fication of industries oroAiessed, v.rious policies were announced to
meet the difficulties seen at that time. In addition, the National
Industrial recovery Act imoos.ed certain requirements unon the Adminis-
tration r.s to the truly representative nature within the industry of
persons or ;roups narticinatin7 in the formulation of the code. (*s)
The enforcement of these legislative requirements end policy announce-
ments -er.c -so.etimes evidenced by stiys of code authority provisions;
i.e., the conde -)rovicions -hich' created the code authority as an in-
dustrial ed.iiiisterin, body v.with certain rights thereto and obligations
thereon, Th'-e t".-es of code aathoritT provisions subjected to stays,
insofLr z.z t-'e investigation for -urnoses of this report is concerned,
(*) In i.c ition, it shouId be noted thliat thirteen (13) amendments of
laoor provisionss .ere stayed ani. seven (7) "eliminations" of labor
nrovisi-as or )arts thereof rere issued.
(*.) Section 6 of the Act
TYPES OF CODE PROVISIONS NUMBER
Election of Code Authorit- participation
of trade association -------------------------------- 3
Reports end schedules 3----------------------- 3
Code authority finances ---.---------------- 81
Liabilit'- of code authority -..--.- ------------ 1
Incorporation of code authority --------------- 1
Label provisions ---- .-------------------- 1
Adjustment of rages above the minimum code
authority proposal .-. ----------------- 1
Code authorit-p owers of classification
(a) Indus brial or trade -.------------------ 1
(*) (b) Geogra.-.-,hical -.--..--2------------- 2
SLegal objections (the renuireinentr, of Section 6 of the Act) caused
the stays of the code authority election provisions in the three cases
tabulated above. The stays of the labol, incorporation, liability and
insignia orovisimns above noted, prevented the conferring of excess
power upon the code authorities involved. All of the code authority
finance provisions, r,'ilh the exce-otion of nine (9), were stayed in
order to meet due process reruirements; the remaining nine (9) provi-
sions were stayed insoar ns Paragrr.-.h 3 of c-%,inistrative Order X-36
(relating to assessments 'upon the major line of business of a member
of industr-) 1'as concerned. The stays of coue authority provisions
relating to classifications were the result of protests by the several
Advisor.- Boards of the Adninlistrntion.
T.AD,. PF:ACTICZ P:0V.SIs01S
Trade -practice rfl-visions of a cocie involvedd various ty-ies of
trade regulations. Tr-zde practice rules can be classified as follows:-
(a) rules .jenerallv accepted in law
(b) rules desirable to in:lustry or trade, but not fully
accepted in law
(c) rules desirable, but no basis in law
(d) unimdesirable rules
(e) unenforceable rules
The hopes of industries and trades in the soonsorshio of codes
were hih. It was e:coected by -uanr' members that the approval of the
code would result in the solution of all their industrial or trade
troubles, Consequently, trade orrctice rules in all of the above class-
ifications v-ere submitted and strenuouly urged by code sponsors. The
early promilgation of codes for ack.io'-ledged reasons of expediency and
the sincere atte-pt to effectuate the imnmediate reemployment of American
labor resulted in the inclusion of undesirable and unenforceable provi-
sions in codes. As Acfinistrative e:oerience increased, various
(*) These were two eliminations of code authority provisions, both of
which related to objectionable features of the code authority fi-
nance phase of administration.
nolicie "err-. en'mn-iated, r-rt .-ictin,7 tC. -.coe.- o' rcccptable trade
practice e :rovinionsi,.hic'. policies rn contrar- to th,. form of the
provi-ions contained i. the .bove :nentiored er.'lr co,'-es. This situa-
tion caused co.'.e- -)onscrs, to stress ti-eir '-.oitibL !iore strongly and
to refuse consnat to '-itiLr-' or -.cl.:te t..- r-.rtcul;'r objectionable
tra'e -ractice 'rovisions. In rd..ition, the Jevjlocnent of Adninis-
trative e-mcriencc required th- initir.tien of vaiio-ad studies and in-
vesti-ation', to determine the vp lac of p:rticular trade practice rules,
their effect u-;on small enter.):'ize, ccnslm'--:-3, I.oor ena other in-
terested Froups, the tcndcncie, thiroof to',ards monopoly, price fixing
anLd othe?' evils an,"' nalo th- ac'minis:t;ative problems pr'esmnted. In
short, thi u,:e o' ct?,'. in connection -'it.. trade practice provisions
carriedC ovt the A'- .ini-t:-tion1I det :-mination to adhere to announced
policies &Ia far -. pos-iblo, t.iereb,:, overric'ing objections of industry
or group-, t",cr;-of, r-n,'.. at the .-ic ti.ic enforcer- tho ordinary re-
ouire-.ent-. o01 v-C.iu'.i:trativ'.- ly.. Tlii exercise of foresight did not
obtain in t.ie crs,2r of aCll codes r.nd, ac a rebuilt, the noner of stay
naz exercised at ". ti::c rubreor.ent to t'.3. ;'.n -)r-ov.?. o a. code uion a
sho-'ing to or finC.in ,- b-' ':.-A t-.nt taic n-.;'ticulr"" r- proved code or pro-
vision thereof '*e". resultinj- in unreason.blc p.nc. vmfrair application.
Perhaps a correct an roachI to a stud;" of strys of trade practice
provicion.s *:ou'_c .e nf e::.iiinati )n of the .-crticul,-.' code provisions
affected, bearing. i :"ind tl-e classification-i of trace practice rules
set forth in t..e o -enin.- par.ara-h of this subsection. (*) i1o attempt
has been .ac.e at this tine to classify tlhe various trade practice
rl!es, buLt thE results of the inves-ti.ation sho-'s certain types of
trade pra.ctice nrovizions uhic 'i& been suLjecte. to stays, all of
-7nich are ta.bulotcd .s follo,-Ps:-
T*?ZS OF TRAD-Y -ACTICE P_-rOVIS1Cl:S NO. OF STAYS
Resole rice u;.aint .ncc----------------------------------- 10
.equir3iaent of ch:r.;in. tranm .o--tat ion costs to merchant-- 3
Prohibition of s-le of exitin,- stock----------------------
(Distrers n-rc!rl-ise) 1
ieithiod of determini-i- price differentials.------------------ 1
Definition of I"tz.n:rortation charges from: vuholasn.ler
to customer"------------------------------------------ 1
Provision for pta-m.rnt of volume allowances to retail stores 1
Establih;'.ac-.t of differentiall discounts betvrecn rholes.lers
a;,:1` otler cl.s-es of urchasors-- -----------------2
Open price filing s-stems---------------------------------- 19
".aitin- period. oon orice syst'.- --------------------. 183
crch. .isir. n s----------------------------------- 5
Fro'hi'cition of aculterp.tion .rr& i.is.3Lra_.. in ----------------- 1
Provision prohibitiw,-, conj-racto" to cut : t::ii for
:in'.ufacture of -.r: lent --------------------------------- 1
Perce.-tr-e linit-t i uo oon r-.t-.t-'. rice ------------------- 2
Frov-.iln incor-c:.-rtin Feep'ri rooe j-.,: :r-r Act----------1
Provi,.ion fi::in- ti-rj.i .icco_-zts rn," t-nr' of r.]e------ 15
Provision inci.-in- c nlo:e.s' contr-act i. "int.rfcrence
'it: c.- titorz cont-.ct" clau.se----------------- 1
Provisio-s ocrnmittin- nantfifactu;-cr to su--e--"t res:.le mini-
(*) See Cz n-ter V
TYPES OF TRADE PRACTICE PFOVISiOCTS (COITT I'.TI'.D) irO. O0 STAYS
Prohibition of receipt of "crip for payment of mcrchpndise- 2
Prohibition against ist"-ibutsrs un.,erollin'-, jobbers ------ 1
Prohibition of -e.les contrary to rub]'izhe,'. :rice lists--- 2
Prohibition of rroc'uctior of ci-stoi--mad? goods comparable
to rta.-nLard. oints--------------- ---------- 1
Uniform cona.itions of s-le and ,'thoCs ,if estimates and
ouotations------------- ------------------------------ 1
Definition of "co-tr.ctor"-------------- ----- ----------- 1
Fixed minimum. terni, of rC.l.--------------------------------- 8
Li:.iitation of credit *-e-iod on govei-rne-t ,ur.,se------- -
Fixed estimate forulC.- ---. ------------------------------- 1
Prohibition of future cnles -nJn dJ-liveries
(requireri'nt of reoort)---------------------- 1
Requirement of pboeo: ont bot'reen jobbcrj rvnC. dist-ibutors
to file price clc'-ules in acccrriance witnj code------ 1
Requirement of rrcoueint to racell in accorC-rnce .it1.
code proviFio:-.3------------------- ------------------ 6
Prohibition of quotation of -ricec o':hr thr.n f.o.l.factory 2
Special rules reg:tirrin "id_, to gove:Tn:.:c.t:..l a-ecic .------ 15
Prohibition of cou-lon c.. *.iTi-- 8--------------------- 8
Prohibition of "b-'a: .'",- t:.o" morch.tndisc disrtribution-- 3
Prohibition of 2ss-s.Jo, i. of c-nrsequ::-r-.ta j.aes--------- 2
Prohibition of fru.-i n-.i-rn d eti le". 2Ihop Lra'./ing:. of -oroducts 9
Prohibition of -fur..i"hin:: sLCo d0rariLi-s '-it iout cF-r-re----- 3
Prohibition of c-Le sttive orice c'ittin ------------ 9
Prohibition of "poolcd b-i:i ------------------------------ 5
Prohibition of "trade-in" al-o'-nces------------------------ 11
Provisions seottin- forth *r'ie' tr.&.e mrk 'uls ------- 8
Prohibition of 2_is-eL-Lnatiol of flaL-.3 i.;cr il.tion re-e.rd ing
product------.--.------- ----------------------- 6
Prohibition of con: .--iseat -rl ----------------------- 1
Prohibition of inf.:uce::-':t c' b:-ach o' co;-.tr.,ct------------ 5
Provisions prohibitir.nl seles I-'n eva-io.- oc coce----------- 4
IanC-atorv reouir"er-i:nt of re:irtrrtio0 of ;--.-n.t:, dis-
tributors, etc.----------------------------------------- 1
Provision rernittiy fre3 E.dvicr nru" consultc.tie"',. services
to 1urchas'r.--------------------.------------- 1
Prohibition of n'asorotion of in-occtio. her:e---------- 1
Provision e::eupotin; s.ies to erx ort tra-d6------------------ 1
Uniform acco-itinc r.,.. cot-ining s"ste'--------------- 7
Prohibiti:,r of 1.urpret-:e:---------------------------------- 1
Prohibiti.)t of rent-!. of 'orv.ct----------------------------- 1
Prohibitio-. of d'.Isco-iunt. except c,. .".iQ1co.ncs-------------- 1
Establilchncnt of t'.c unifnr, 2 ."nC-- contract-------------- 1
Provision requirin-; p.."oicptiot of uricez covering in-
stallatioi of. product--------------- ------------- 1
Prohibition of allouxcnces -or adv_- isin.. ----------------- 1
Prohibition of attace-aa.int of IIRA lan'el to garment not
iladce uid-c the codj- ---------------------------------------- 1
Ten of the above list of tra,.e practice provisions were stayed
through t.he process of "elir-ination." Those provisions which were so
eliminated are aF follo','s:
.'PE C. CCDE 17CVISi- T 70. 0? ELIPIIATI0TIS
2c.'. le -..rije ;.;i v ._. r.nce.-. .--- -------. .-.------------- 1
:s t m I : i;;h:.2>.nt oP :.; -'i :-a:. z".-ci.unt,.-. --.-- -- ----------- 1
prohibit ir -:f --'t, '.- -.1-e: f r'.t -' i.v:-" c----- 1
Prol1itti ion of -lc c-nt I t r C.t"li :-c mric, list- 1
Fro'.iibitior of u.n'c.:".U i::i- jofc'o-:r- 1--r dint .-itutorr-- 1
Pr-ovision perit- "ir7 --. of. ..i.; .L r:c nric. 1
Inclusion of ,. -_oT-.es- cont-'ctc i- "int. r'-f'rcr.nce
-it.lL com-r etit-ors' crntrnct" cl-..-'. .. --- ---- 1
Inclusion of Fer.-.l 'cc.. D:". act --------------- 1
Frovisy I.-.n rohib'it in, ad-L-utercat o n -n. A.1is' randin;--- 1
It sholrull& b: noteCi f.;om t'.- ..-ove tabulrtions tA-.t nost of the
trade practice e r-:ovi.-ions ct:.-yeL rjlatid to r"ric provisions, either
with rzc.occt to p.i..-1'1. ericcz, r-salc price unrint.-nance, maxirnum dis-
counts -un'! t-rms o. sale or o-.-.n ;-ricc filin.- -'.nt'.is. The tabulation
nhows tr cf -roviFions v.-iicr os ..-'c oinnril. ",u* --L,- clepssified as de-
sirable anid c-nforco.,blec; e.,r., a .ult:'-rtior. -nd mibrap.nding clauses -
intTrf,_i'ence ith -',otl-rz contract. Exeii.ation of th.- stays of these
particular urovicions dioclose-. thr. tw' ta- v.. s, i-..-,ued not because of
th-3 znrpones of tn- particular -.*rovisi:r, but rathe- theat the Dprovision
.7as im:,roperlyr drpfte. c.r too stringent or e:tonsive in its scope and
-r-lica.tion. I0-tho.s of obtaininT uniforrj .rices, or at least in-
formation rs to the court, equally fell undc-' t:-ii.n avel of administrative
action. Uniform cost systecsc, methods of osntimetin- mnd quotations nere
s'u:-nittrd b vario'ts codc-snon,:rin- -"rour.s, but such conter-olated. pro-
visionn rpn foul of cit`-.cr t:'. le-cal or police requirements of 1RA
resultin,- in o s"t of t':.c Drovisinn.
The exerinatir. of the records of the tradi practice provisions
subjcctcd t,. stpay- did. nnt in n-l canes dinmclos1 reasons uhy the par-
ticular stany h-1d !' xn .."1,ioCL. In addition, the author has not had an
o.po' rt-'Iity t-o 7ul ,..: :-slor- :- il -: t: r:,cors. r'-latinr to these
various rntayc,howev--, om.-e of th.I filcs ar'. orders e:-.:.xined did dis-
close sonE- rersonz rn-,for pur-'csor of this roort, certain cissifi-
catio:-i if '-.r-orn3 -.vc bo--in ;,",.. -n tvbil.tio" tlnrCrof set forth,
*- hie.: yes so..ie rict'L.u-t of wh;- U.A O:'erciC'^:L tMis a,1-L'inistrative
r--..cdy. Tt: t.b'_Iltion iv as fol.o'.:.n:
P2AS01TS FCR STAYS OF TRADE PRACTICE PROVISIC'ITS njl3ER
For fuirt:.,- r invert i---..tion. -------------------------------------- 7
Fo"r ','trminz.tioa of aCdirzuilitr of r."-.:-oval
of cod.c provisions ------------------------------------- 2
Ccnn.iir-ratior. and 't-rin..tin br A-A .-- ---------------- 2
Considcration (of objection" to ...--ovi-'.-ion,------------------- 8
St,-r-s rc.-iUtin- fro-. encrnl st...ie init.i-.ft'd by rA------- 188
Furt-..?r inv'.-.-tir-t .n .nd :.'arin--- --.-------------- 5
P.-n.i-n .C1 ic "-it i- c :0el: a'.t->r it---------------------- 1
fDur rrocr.sn r7:'.j: .t.------------------------------------ 75
FPn.di fv.t-: cor .ct-------------------------------------- 1
In u.t:. r-n....t f.-r "-dditi '.-1 tAi,.:, *:, t.l:-- -..--------- -- 1
PF'n(.in -uzni- -ion of cvid cU.-- b-L i Iui-t :--r------------------- 14
Peni`.i:r -sti -f-ctc:- o rr.:,-mn .r fo- confi('rntial treetrient
of' nr:'ice inforet ion-------------------------------------- 2
It is rc.polizc t'.r.-t t- Lovte lenevl c.ssIfiictions of reasons
C.o not cho- the "ouroosc of '; "fur...r inve'tiations and hearing",
th? "stur".iej initiate& b- "_A ur t'.. object:.ons borin considered.
In co:..c cases I, rticilr.r circ,;rstr'.nc .rj -i.vaL e-:isted in -particular
inc'.ustrios which r,-quj.r:C :.u thor stimCr or invu.stip'-.tion.(*) To J.elve
into these reasons, a fuart,i. r rsx.i mo:.e- :.-haustivw stuey must be? con-
The above tabn.lc.tion sho-s soi^; on,. LLdr:c. mriO eighty-eight (188)
trade practice provisions sta',uc bocaus:: of' studies being- conducted by
NBA. The ,majorit: of thirse stays' aled tu the waiting period betweenn
tVe ti.ie of filin-- of price lirts viit'h r. cod.e auth-ority an8d the effect-
ive date of such ptic' lists. Office Orcer ':o.63, issued by the di-
rection of the Adni-nistrctor on J;..r,..rv 25, 1934, annoc-tnce. thl.t a
study as to price clhin-.es -n s beinr- ..;..de % t.t coc'.e provisions re-
lating. to open price associtins .-ould beL stayed. in the order of
approval of the coc.-. The scoce of thin or.cor .r.as later modified, (**)
but its result vaes .-r-jst nr..:ber of strys of th- waiting period pro-
vision of open prices cy-ttems.
It is of int?-roet tc not- th.att i-hteeon (18) str.ys of trade pranc-
tice provisions a-rc io,.d, '..-'.i. ostpcnic'. t-e effective dates of
fair trade -oractice provisions.(***)
The investigation of t.hL.e records of stays of trade practice pro-
visions discloses t.t most of" th stays wor- issr-ed at the time of the
order of approval of th--. cod.e an(d that in s-ch orders either one or
several provisions of the coc. waerc affected thereby. It is further
disclosed thEt t.o hundred rnl ei--ht (206) codes, practically half of
the codes examined, contriner n-. rt,:-- of trade pra.cticc provisions in
the order if approval of thce cede. A list of such codes is set forth
in opendix ITo. 2, he_-sto att.ch-.6_..
TI:! OT IJSI'*V- C? STAY
As sta.te'. in Chanto;- 17v, rnte, the co er of st.y ,-'1 r exercised by
the AdIr-inistration at tire.: ot'.-:r tirn the ti.ie -f the order of approval
of the code and investi-,ation ':a- 'ir-ected to ce-'ta..in codes to-study
orders of stays ii-uedC at .. tii.e subsequent to an order of approval of
the code. The e:.xrination c.isclose-. t'.t icst of sucih stays had been
issued as a result of r9.-:,lication by a particular industry or -trade
ancL that thu cod-e provisions o. 'ic. relief 7as sought referred to
maximum hours or nniimumn .n.,t-es, alth,:,-h. a fe. sUich orders of stay re-
lated to relief fro:-i trp.de- ---ractice .:;"oviszons. The schedule set forth
(*) .The order of 3.Y`ov., of t.e- ::otic-. Picture Code, Code ITo.124,
stared cert.-in tr:e 'rctic-3 provisions r.elatin:; to t'he oay-,
ment of excessive salarie: to exe-cutives ,.nd other employees.
This provision affected. the s.alaries of motion picture stars
and the ef:'ect of the lim.itatioe uron these selariea uris un-
knon at t t'.e ti;ie of t-.e orc:r of r,-.or-oval of the code. As a
result, the or.ovision --.s rt-'ed until ERA hac a.n opportunity to
investi.i-ate thIe effects of the orovioion.
(**) See Office Orders JOE 63-A and Z..- January 27,1934.If1A Files.
(* *) See Order 'To 47- LE nn':rs Code Order To. 454-2, Optical
Retail T:ra-'e Code. 13A Files..
in Apner..ix Po 5,, att.-.ched hereto, is 1."oI1.-l i-i dete-Tninin- the code
and code provisions; nf rcteC'. mnd ti- rc, ;rin", a;v, -ce(. 1or t.:e grant' of
a sta:- -.SLo. equint to cot.e ;..o,',-oval.(*)
Ae',o ncnicc: .,. ** r.'. r. -. "n, tn co' 0 e" L r' i ;:...- Thereto dis-
. -. .. ..
closes th.rt code, -c:;r l,:el to be uLb. ec' :1, to : ,:' .t n6- time
duri*,i- the .-e--i'. crf its a.-n- rov,.1 of a_.j I ..'-t tiot. tc'ne co,.es had
no stars foj" .n"' %.irnoses ',o,.tcoever, ot?.?i s o:.." one -.n:T. still others
a nuiber of tr-yrs. The folo'o-i-i ce'.ule lists t ie -.-.:inus zodez
exnmine& '-:h.c'i ha'n ;,ore t'in one str...:
COD. ::AVI 3G :0: o S:;cY 2.0. 0-7 STAYS
1 C't ext1 --------------------- ----------- 19
Sli.-u.i ;'.i.. n" Siir 'e,-.,' inj .- ---. --- 2
a-* ...e l ".A,-..t.L i f._ L ..... ..... .. K~. a~ 2
3. 'Jo0l *'- .l'- -------------------------- 4
'*. Elc-ct:-ic: 1 .n-acturin, ------------------ ---------- 2
9. Lxber r.-.n-'. -m-r------------------------------------ 5 2
18. C.st Iron SI'l Pipe----------- ---------------- 2
21 Leather---- ---------....... --------------------- -- 4 2
23. Underr',er-r 4... AlliC.. pc-.uct.-------.--------------------- 4
24. Tit'.,inou" L .al----------------- ------------------- 3
01.1 Ilulrner-- -----2--- --------------------- 2
etr.i. L -I- : -. -- -- -- - ------------------- ------- 3
38. Boiler "'n-uf-Li2.ct.vriiI.-------------------------------- 3
L) a r.Fa .
39. Fc-ar: ^':Q.ipi.ie.:t---- ---------------------- 3
46. :octor Vchici? -c t ili inr. ------..---------------------- 3
48. Silk Textile---- ----- ----------------------
54. Throv:in-------.----- ..-- ---------- ------ 3
60. ?et.-.il -ral '------- --- ----------------------- 9
64. Dress V xa:Tf'c ..z :: .... ..............4
63. R o,.l n.mc inL. J --:-- ..... .. ...... .....- ..... ...... ..... 2
69. ilJ~inew-- rz P'-c'!; .',a,. - --..............2
6482. Stelsn Cast in -. ....... ------------------------------ 4
8. 3. Bu'ainess Furnituure, etc.---------------------- ----- 5
9. r.a anc. Ironin: achine------------------- 4
95. _,f fn Poli:.:iII- ".hleel ---------------------------- 2
1C2. Shovel, Dra. line -'. Cr.ne------------------------- 2
113. 'bottc-. r-'n'-t---------------------- ------------------- --
121. -ot.-.--------------------------------------------- 3
124. "oti.:-, Fict-. -----------------3--------
12.. :ol'.ter roer:.---------------------------- 2
123. Ce ient---- ---- ---------------------.
142. 4.etr Jee-- r---------------------------------- -------- 3
151. ..ilJ iiner ---- ---..-...------------.. --.. --.----- 4
153. 0:'-Acc tlen, ------ ---------... --------------.
157. :'air C'ot' :c-.'z" ct..rin------------------------------ 2
176. F-cr Dintrib,.t im-- --------- --------------. 2
182. :et-i oo -- :oc:.'---------------------------- 4
( *) .e ' ; : ,' .:". . t .u tab:7 lrti .in 'o obt,- i -.ie d partial ly
ft-o., tO..o y t.:t 2o"' e..,?..-i.:tia-, of the .. '--r.'7. rcl.tin' to
exenr'-.is ,,'. als.1o :e" -ecnr-- :-c"lotin-. to stn,-yr. Tne interchangeable
use tL:e te:-.. "'J-t' C. afrl. "cxe' ,-.i. .! re.:.-.te.. in th interchangeable
filing o. n;t: -r an... er::e:.rtior,, '.'.-,'ever, for roir-'osee of the tabulation,
t:e record -.-elate only to e:.:e:ioptons or ..tryZ .-ThiciC 'ere .-ranted to an
entire in.r' '-tr- or recognize,'. .ubiivii -. thereof.
coDES }IIAI' i0ryi to 0 STAY (cerrIID -'0o. 0? SLJAYS
196. holermle F oc. cn. croc.0 S" 3
20196. -ole-.lle or D"t-" iroc' ----------------------------- 3.
-0 1 '. .. l0- ^ o : t .'i .. ..i... ... .....-.- ...- - - - 5'
204. Plufoi .' Fitures------ 3
234. ;5..caroni 5
237. A.llo: Ca tinfr .......... --...-....... 5
249. Tag -- -------------------------------------------- 2
250. Zire 'od1 ,n:" Tube----- ------------------------------ 2
257. Printing EquiprLent----- 2
260. Ornaierftal ;oul.ii ------ 2
264. Foundry oEauirment----------------------------------- 3
256. Inlanc. UTat-r Carri ...----------------------- 2
237. Used Textile -------------------------- 2
274. San pancL Steel- ---------------------------------------- 3
232. Restaurant--------------------------------------------- 4
286. Jeaut;,-- a6ic' _ruer Slio- ------------------------------ 2
287. Graphic Art..---------------------------------------- 5
298. U7ipinm Cloth..--------------------------.--.------- 3
313. Steel Wool------------------------------------------- 2
206. i;ica ....--------------------- -------------------- 4
308. Fi-he--- 5-------- ------------------ 5
311. Ready ixed Concrete------------------------------ 2
319. Iens-paper Printi-i.- Freo2---------------------------- 2
327. 'achine-Arplied Srpole, etc.- ---------------------2
329. Uoholster,- Sprin ---------------------------------- 3
332. Laie Hnba;---------- ----------------------------- 2
33-. Beverage "i3crensino---------------------------------- 3
33. average Dir-pensi.--- 3
S341. Fiber pn&. ".-etal 7uor' iutton--------------------------- 2
347. ;:achiner.. an'. Allied. Proucts9--------------------
354. Small Arn-, etc ------------------------------- 3
363. men's s .;ec'::'ear-------------------------------------- 2
36.5. Sand. Lime------------------------------------------- 2
367. ::etal Treat i- .g------------------------------- 2
37G. Peanut Butte? ------- --------------------------------- 3
3C6. Umbrella Fran-e-------------------------------------- 4
393. Soft Fibre--------------------------------------------- 2
397. Sr.raj Paintin: Eoii-itnt--------------------------- 2
399. I:o.sehold- Goods Storo-e------------------------------- 3
410. Retail Riabbe.r Tire ------------------------------------- 3
41. Bolbin and. Spool------------------------------------- 2
416. Leather Cloth F-Iricz -------------------------------- 2
421. Ilarble Quarr-inj2-----------------------------------2
423. Drop Forcing--------------------------- --------- 2
445. Baing-------------- ----------------------- 5
451. Candolewick 5ed:--l re--------------------------------- 2
454. Optical Retail--------------------------------------- 2
458. iUholesrle Confectioners' ------------------------------- 4
460. Preserve, :.araschi'.o Chery----------------------- 2
462. Tnolesrle Tobacco ---------------------------------- 3
463. CaicLy !Lanufr,.ct-L'i:ig- --------------------------------- 4
466. Ret.il Tobacco-------------------------------------- 3
467. Cigar ILanufacturinp,---------------------------------- 2
471. Trailer i:anufacturing---- ----------------------- 2
474. lTee'.lev:ork Puerto 1.ico----------------------------- 2
CODES HAVIIT' i:OR_ THA:' 0,2 STAI
478. SccondaTy St '.--- ------------------------- ------ 2
46fC.. Str-actu-.-al St.el------------------...---------- 3 cr
4C5. Cotton Gi.inn i:2 ci:c r:L; -e---- -- -- --- 2
490. ImportcLh D.at23 1 c'.-- .n ------... ..----- 3-
5C, G0 '"1loles....le F1wabin/, etc.-- -- -.-- ----.- - 2 (
509. ,.:rine Equirm.:nt ..... .... ..------------------------ 2
CODES SUhPLEZ-.':TA.Y :0 BLSIC COD S
84. Fnb-'icL- ted ctal P.o ct ---------------------------- 44-
83. I,uciinosr "i'r',iture, etc.---------------------------- 2
1C5. Autor.otive Fnrts -n! aouicr'.e't-- -------- --------------- 3
2C1. Tholesa.le .n-l Dit"ibutin------------------------- 6
273. Chenicrl i'tanifp.ctturin.- ----- --------------------- 3
347. i'.chincr-' a. Allie- Pro.ct'.---------------------- 3 3
ITo examples of retroactive -t,:r:t '-er* f*ounrl.
A rev ntcrs '7ert" found t4r, riici cr tere ..clec. conditions impose
uoon t'.e oersonc seeking; the relief in the stay. Stars of labor pro-
visions of ten cont.n ind6. c nt ition a- to the na.rment of an overtime
rate to: hours or'ec'. in excess o0 tie ;axinuin hourss.() Stas of
trade r.ctico provisions in comc cases continue. conditions. (**)
The above ex-zMles of condition,! .tlts we:. ones issued after tie
tine of the aw)?rov-.l of t"-.-. co'e. In 0o-.2 cnorS a stay- in en order of
aprnroval of p cock cont-.inoi c-onC.itio'" b- '-,hich co-tain parties
afforded the relief of the ntn.- .r w'ufl. be required to do something With
respect to the contini'-.,nce or te--.in: tion t'l.--eof. (***) The author of
this preliminary rcoort W-a conti '-*;u the -.,Yj, ect of conditional
(*) Sec Order 131-25, in which r stnr. from the ,-rovizions of a
code requ.irinr Taymsnt of time -n; one-hll" for overtime was
gr-anted on condition that -,i overti-.ie ra'te of tine and one-
third be naid. In thi.i or'er a fuirt:iLu: condition was ira-
-oosed that th.e industry or'- its erniDlnyces the first five
(Cr) d.'ys of the z.oce1;. Se- al-so O0Ce; 467-2. i2i.A Files.
(**) See Order 6C-1C5, st7-- of lo- lia.'itotirn provisionss on con-
dition tlvnt no n-.le- 1-e naO.e to rmE:.iber of thu industry: at lees
thamn nix prr cent (C3;,-) above cost. (lRA Files)
(***) See Ordecr 41 Order 347-15. "TTA Files.
(*sa) See Preliminar.- Rc-noo-'t on E-:e:rptions -nd 3:.wcentions. REA
Organization Studies Section, Division of 'evie.i,NIRA Files -
Ch.-,ter IV, Pge 40. The le%.-.l phases of exemptions have been
discucsed therein end since it is the opinion of the author that
a star and an exemption are to all practicaP.1 extents the same,
it is sur.gested th..t reference be m..de to the treatment of
conditional exemptions hereinbefore mentioned.
E1TIAL OF STAYS
The records o- the or6crs of n"-rova.ls of codes end amendments
disclose no denials of stavs as t'e-- all rtferre4 to grants of stays
or else r:ere silent on t':e subjectt The author hos haJ. no opportunity
to e:-amine the recorL:; of the various codCes in ".iaic~i applications for
stays or considerations 1by iTRA of protests, had. caused contemplation
of a stay., uhich stay did not matr-rialize a.t the time of the order of
approval of the code. In addition, there has been no opportarity to
examine the records of various. codes With respect to applications for
strys received by in accorr.ance ith thie rule and regulation set
forth in Executiv.- i-.er Ho. G2C5-B, surra, however, examination of
the records of stays is.mued alter aponroval of a code s:-hcs that one
stay has denied. (*)
FEICGD G? STAY
Administrative discretioni witL.. respect to the rant of stays
includes determination as to duration thereof. ff necessity, and
properly so, this phase of discretion is r..osedr in the administrative
agency. The HRA e--ercised b. .-i.s-it b' c"antlnir stryz for various
pe-iods of time, rn-';inv f:o.... on fl-" to n.i unliinited period. In some
occasion., it becn e necess rr to r--:ten6. thie oerio. of st-- anf. in sore
cases Then the need of st" vwas ni longer evident, either union
application by ta-rt icul-t' interezte3. ...,rttic or initiation by NRA, the
duration of the str.' ,'as te'uinate&. (**)
Ths followin- tabulartion cisc]oces t't jc:i.2s of ti.ie for 7'hich
stays ve-e -rantetd:
PERIOD 07 STAY 110. 07 STAYS
Unlimited.....------------ --------------- 70
To June 16, l355. ...--------------------- 8
One year---------------------------------------- 1
Si:: months to one ye?.r- .....--------.. -.--------. 8
Ninet:- days to si-: nontis-- .------------------------- 20
Sixty to ninety days---------------------------- 26
Thirty to sixty das- -------------------------3
Fifteen to thirt ac--------------------- 73
Ten to fifteen days------------------------------ 120
Two to ten da.s------------------- ------------ 14
One day----------------------------------------- 4
Pendin.- study---------------- ---------------- 17
PenC.irw further order---------------------------- 220
Pending amend-aent or -e.ring------------------- 13
Pending submission of evidence by industry or trade 16
Pending election of coC.e authorit- ---------------- 2
(*) See Order 11o. 88-18 ilRA Files by .7'hic.i the Steal Shelving Division
of the Business Furniture, St~ra.-e Equip'.ient and Filing Supply
Code -'!s denied a stay of the trade practice provisions relating
(**) See Or&.er !o. 445-13, Tr.-in- Co,'e E-:tensinn of :- stay; also
Orde.-s Tos. 467-L3, 467-4C, 47-46, 467-48; see AcLiinist-'P.tive Order
X-8, termination of stay. !iTA Files.
A number of or"-'ers of st '.i. not di:-clo'e. t-e r,:.rticulp.r nerioC.
for hic> the t .t... -r',ntc-.. Ii. - itI n, ro,.ae orz.rn of strys re-
l.ate'C to sevc:r.l rovisions of t':.: ct'.L oire ):-ovision '-ould be stayed
for a oerio!. of c.ixt" (C'.3) .In -.nd n:-,.t.. r "rovir. inn stoyeG. for a
period of tftirt- ( dys lthou.-.;. one or or is involved, the various
perioc'os of time hr.v' been inclurle('. in the abovee tabulation.
As started abov., due T.ro(cZ rcuir": 1.,ts "or.-' ict with ,n order
of stay v.iicli i -.L z iu-o;n as a "notic,7 o"'oi crtu'i.tt to object." The
majority of sx'ch sta-s inv.ilvi.i" duw r.-oc.-ss requirements nere either
for a t,.riod of ton (iC) d.aysn or fifteen (1.5) lays. A -rroat number of
sta/s '-1.ucn ,ere iz.-:-d. -c: '.tL:' f..u'thL.r or'.:-'" -'eru thle result of (1)
sio-' ca'.r-se crre- t .,,e',' iui tiie nrtlr2 cf a "notice of op )ortua :tlr
to Ic nar:.'" nc'. involving LaC :rcccs.:z reouirei-ioents) (2) Office Order
.'O. su,rp., ncA rcfe-rre to tihe corn m:J.etion of a stur.y of open
uric. filiL-.I -.,' tc .s.
Dther order, of str:y ';rie,' s to dua'ptioni. T' e sta:'-s for longer
periods of ti'"ie '-.ero for t e u.roes of ,tu.," of on.rticular industrial
evils -whiic;; r-ere pttemoteJ to ..e r-moved tLroemh the vehicle of code.
provisions which -nA was hesit-.nt to an-rove. The shorter periods of
stays were to meut tein orar/ r situations enisting in industries; e.g.,
necessities of overtime for inventory t.'cinr; ti:je lost through
holidays aniC other emer;;ency requirements.
EVALUATION'S AND COCLUSIONS
The purTosee. of p. str are simil..r to tliose of an exemption (*)
Its use pv'i exercise depend -.,,or. 1,-.-islative -rc-nt an administrative
1r.'7 cictr.tes that the ex:ercis:e of this oo,,er should we fair and. reason-
atle. '.o mention of the te.n ".t--y' or any" uo'wer thereof is found in
the Act. Any s'ic.i power is b-.7e,. ,urel-r ueo:: a construction of the Act,
the wording of- thic', is sufficient for an implication of a. grant of
_oc er. In vie-', of this l:ch.: of specific mention of the term anW. state-
ment of .2ower, it i!7 suggeste. that contemrlcted legislation, if any,
male special reference to tlhe now-.er of stay and thi,.t full and adequate
provision be made whereby thL agency charged with the administration of
the Act be oermitted to exercise this .-Dower at any or all times, either
generally or specifically.
It is tlhe author'r opinion thar.t th'e safest r-liance upon the basis
of po'-er to grant a stay is found in Section 10(b) supra. The chronicle
of tnc delegation of rower to -rant stays as set forth in Chapter II,
supra, discloses that gener-al poer had been conferred upon the Adminis-
trator but that the powers conferred by Section 10, were expressly re-
served to the President. It is true tha.t sTecific mention n of power to
( o See preliminary Report on Exenritions r.nd Exceptions, NRA. Or-
ganization Studies Section, Division of Review Chapter V, page
48, l A Filcs.
grant stays is found in Executive Ore.-r 520-B, but t.'is deleg action
is limited to ccrtiir. n-lilic.tions received from specified individLuals
wit iin a Thfinitc ocrior'l of tine. On Icct,.nbcr 50, 19, Presidential
delegation of power refe-rred to "e-e.n-'itions and eLi.ni,ations", but still
no power of stay was mcntio-.cd. It mny be argued tc-at the powers of
stay wore so si.uilar to those of elim.:ination and oe-.nition that there
was no ncccd )f .-)t .cific -.eiution, It issabmittcd that tl- actual exer-
cisc of the power of ssay should be bacsc. u;on delc :n.tions specifically
mentioning the power and that, in viewv of the fact that a stay relates
to an entire industry or a r;cn,;,nized subdivision thereof, either
gEeo.-raphical or industrial, the delo_-c.ticr.ns should be limited to the
Administrator cr AdrLiniztrative Board, with a possible delegation, if
necessary, to an officer authorized to handle grants or denials of
stays and exemptions (*)
Chapter III 'icrecf sets forth tihe various attempts to define the term
!stny". !,o legiclPtivc definition left a charted course for MRA in this
respect. Various d-finitions of t..-, ;owcr diff.'.red from its actual use.
Wne line of demarcation *.-'s arbitrary and ianly times it was disrcgrded.
Interchangeable use of such term ns as "exemption"," ztay" .nd" exception"
caused admninistr tivo co .'ucion. T.o term "elimi-iption" likewise finds
no legislative xmidc. o li 1 it-.ticns wvore im-onncd as to when a "stay"
or an limitation" should. be invoked. Words as zuc'-, are mere vehicles
,but when use, administratively, suost:ncc and procedure dcmined defini-
'tions and cl-irity. It is tihercforc wgetctd tU.t legislative defini-
tions of the terms stpy"' and "e1li:.iination" should h-ve been ,1ade.
A suggestedC definition of thec t-rmi "st,?y11 is adrl.inistrativc action
whereby an individual, group nf irdivi:'uals, eitl'...:r .eojraphicJ) or in-
dustrial, or an entire i. uuscry i: reliev,.d fror. tL-e operation
of the provisions of a cwdc, i. ,'-hoeT- or in part, by t.ic order of
approval of the code. (*-)
Ho suggested Ksfinition orf ti-c tcr.- ",1li.,in-ition"is made. Its use
depends upon the policy of a:r a.-ornacL. to code-makini-. Aoprroval of a
ccde can be "rit'uheli wL.til nill objc.ctiimtible fentares tiererf are de-
leted, thereby eli-mninatin, n..-td of t.-Liz form nf ad-.inistrptive action.
(*) See Preli.miary Rnport cn h.',iihpt ions Sn. Ercentions, ITRt' Organization
Studies Section, Li'is-ien. of ?-cview Jhaster V, Pa:-e 55.
(**) See Preliainary P.Re-'ort on Exemptions auid Exceptions, IIRA Organization
Studies Section, Division of Review Chapter V, Page 52
if the ornozite proccarour ic aorjteo, n full legislative definition
of tnc term should be s--'t forth.
The rrant or Jdenial of a :tay involved the exercise of administra-
tive discretion subject to certainir Ii t9iton' set forth in the law.
Limitations imposeC by ron.rcss in the Act r.ire in effect "to effectu-
ate tb.e policies cf the Act", wrilcn olic.es wre.p set forth in Section 1
thereof. It is a'qitteC t.,t ttc.sc liriti- ions -"'rnitteo an ambit of
wiL'e administrative action. The n-cnssitirz o^ fair-Tt, reasonable uso
of the ociwer of sta:' within administrative discretion arc aouarent and
some criteria therefore snioul.' Ie set forth. The criteria should take
the form of stanrJar. s set forth letisltively whereby oo.ver conlc be in-
voke- upoon rrocf Pnu fir"nr mnat the Larticul=r situation is one which
comes withinn thp liunits of tre stqn ?rus. It is sugzesteC that the
creation of trnesp stan:!arrc be base:L 1oon tna experiences of NRA in its
use of Ti'ns oCwer. Thr sources of tnese experiences could be found in
the various reasons why cones or core provisions ,Pre styver. Some.
treatment thereof is set forzh in Chapter 1 of +his report.
This report hMs bepcn concerere, with stiys ind has limited itself to
those vhich affected entire industries or a recoEcnized subdivision there-
of. All tyres of stays were fond as a resoalt of he investigation -
some aoplying to entire inrastr.es; other aoYlyin,7 to separate individ-
uals. In actual administrative practice, tne term "stay" was synonymous
With th',.Lt of "exemp-.ion". The files and records were treated in th
same mar.n-r ?3-d the author fin.'", that th o-oblems of an, reasons for
the use thereof were alike.
The use of condition:-l stq s often amended coOe a provisions. The
practice of attaching co-iitions to orders of stay or exeTnmtion may re-
sult i-. invalidity of tru. condition, deoe.i,1in- uonrn its relation to
the ourooses of the Act an- the excmotion (,.
(*) See Part Three hereof, Choapter IV
Apocndix No. 1
-..L2-. F E.'J C' 7 1r7'ID. .S S OF 'E STLTY
This re-oort hos been '-rinarily concerned witn information which
would be on benefit to 1 elisl:-tive con.lit'ees or conferences. A cony
of thu ou].ine (*) sugzi-sts i-ore dt..'ild review of the subject. A
numberr of c.ectionu of suca outline nrve not oeen considered in this
report. Questions of procedure adminiistr- tive details, routing of
avolications, considerations ha3 by vqriouw Advisory Boaras and the
metnod of final .Admrninistrativ.- deteriinaGion arc not considered herein.
The analysis of th, ty-cs of co-ic o-ovisions subjected to stays dis-
closfs that this ;.dministr-Ltive powur was utilized to meet due -orocess
requirements, Tne form of such a swny, izs effectiveness as a form of
notice to interested ntLrties and also the question v/hether or no-t its
use met with the leg;l requirements of due nrocess are all subjects
which -ire important to r roun-ed an-L conolete rot')rt of the subj-ect.
Tie ai'visabilihy o1 Lhe use of "eliminR.qion" a-.s an administrative
weapon in the )roceosS of coQ'-:-c:..ia,- i.s i'-nderit ur-on the questions
of procedure and -oolic,. i l.A iing to the soonscrinj and requirements of
code anorovels, therefore, tn,- soundness of administrative policy as to
the use of "1 lininaGion" is a subject worthy of coa-sid.;rition.
Th.e use of the ro"u,.:r of stay for substantive reasons often was
without notice to iaduso
should be mp.de tile subject of ,rior notice and, if necess iry subjected
to public ,icarin.; also consi -erations of due process n?ve not been
touched, in t'hii r DIoit.
Administrative use of t.i st:cr:.'r was evidei.ced in approvals of a
number of code aLministratioi matters; c.-., code authority by-laws,
trade practice cormnl.int pla-s, 'ud-ets and otner matters. "Whit ITRA
did with respect to these 'hrases of its activities insofar as the
subj-ct of stay in conc-.rLIcd is .,ot covered oy tnis report.
A complete analysis of t.i ts-ms of code :rovisinns subjected to
stays and the reasons for sucn stays s.-iould b:nlefit tr.l- steady. It is
true that this oh.-se of tnac subject is covered in tbis report in a
preliminary form. There coulA b,, furt.,er dievelonment of this section
of the study.
The autnilor nns not bce,-,n ble to exrore the records of those
situations v.'-ich resulted in ti, d-ni-l of stays and' tLie reasons for
such denials would be a contribution to t.ie further study of the subject.
(*) Anoencix ?To. 2
1.1 Objcctive and scrope of study.
3.as s in tae Act.
,.1 Section 3 (a).
2.2 Aprlication )s Sec. 3(a) to Sec. 4, Sec. 7(b), and Sec. 7(c).
'.3 Sec. 6(F) r-i. e(b).
2.4 Sec. 10(a) aid Sec. 10(b).
.5 Limitatio:s, if any, unon tne President.
&.6 Reasonable imolicatiois.
3.1 Ordinary definition.
3.2 Legal definition.
3.3 Ad.ni".istrativc d,.finition- cnanges thereof.
3.4 Discussion of relation to terms "cxemotion" and "exception".
Delegation of power to grant stays.
4.l Tctcessizy of delegation and extent tLereof,
4.11 To tne Administrator.
4.113 'Forma of delegatin
4.114 Lim-tations on dule;-Etion.
4.2 Retentions of po.ver by Presid n.t.
4.3 Transfer of oo,. er to '.J:.L.?.
4.31 Rtule3 c-id re.-.iltions )" ":.I.A.B. regarding executive
-rants -r r.-'fu.sals :)f stajs.
-49- Part vTwo
Appendix No. 2.
4.311 Form of approval.
4.312 Formalities of issuance.
4.313 Cn iangOes.
4.4 Additional delegations of, limitations or conditions on
po'cr granted to W.I.-..3.
lote: For purposes of study of subsequent delegations of power to
lesser boards and officers tie Administrator and WI.I.R.B.
will be considered together.
4.5 Delegations to lesser boards and officials.
4.52 Early phases of N.R.A. administration.
4.53 Delegation to Division Aiininstratcr permitting
temporary and e urgency stays.
4.54 Linitations upon delegation.
4.55 Delegation to territorial administrators..
4.56 Legal aspects of such delegations.
4.6 Delegation of pov.er for ouroses of appeal.
4.61 Industrial Appeals Board.
5. kinds of Stays.
5.1 General stay nf all provisions of a Code.
5.2 Partial stay of some provisions of a Code.
5.3 Group stay of all or some provisions of a Code-
affecting a group.
5.4 Tyoical cases.
6. Time of issuance of order of stay.
6.1 Approva.l of Code.
6.2 Aftor approval of Code.
6.3 Ap:roval of amendment.
6.4 After approval of amendment.
6.5 Aporoval of 3ode administration matters.
6.6 After approval of Code administration matters.
Appendix No. 2.
7. G.:n r .l cases ,_,- :-tays :-f codrs 'r a,"ie--a.icnts.
7.1 At time of Code ap roval or Codc amendment.
7.12 Le-islative clariy and dr-.ftsmanship.
7.13 For purposes of study.
7.1- Conf'lict w.ith other Codes.
7.1zl Aoroved Codes.
7.142 Codes endingng approval.
7.15 Enforcee-.it of Dolicy.
7.16 Recognitinn of protests.
7.17 Coordination or conflict itn other governmental
7.172 State or municipal.
7.16 Soc. 6 LTi S -c. 6(,-).
7.19 True reorese-ntation.
7.11 Di-"'iculties of ad-mi-istration, compliance and
cr nf' -rcene 'it.
7.12 Aefusal of industry to acceot administrative changes.
7.13 Otner causes.
7.2 Aftrr time of Coae approval or Code amendment.
7.22 Cnanges in policy.
7.23 Dif-iculties of administration, compliance and
7.24 bon-coorea-raticn of iaciustry.
7.25 Geocraphical problems.
Appendix No. 2.
7.26 multiple code coverage.
7.27 Increase of exciamtions.
7.28 Foreign competition.
7.29 Pending amendment.
7.21 Other causes.
Types of code provisions subjected to stays.
8.1 Code definitions.
8.11 Industry or subdivisions thereof.
8..12 Members of industry and classifications thereof.
8.13 Distribution agencies.
8.14 Co mmodities.
8.15 Analysis of bases of applications and industries affected.
8.2 Labor provisions.
8.21 Maximum hours.
8.211 Normal week period.
8.212 Normal day period.
8.213 Overtime tolerances.
8.214 Peak period.
8.22 ilinimum wages.
8.221 Normal rate.
8.2211 Hourly rate.
8.2212 Piece rate.
8.2213 Weekly rate.
8.222 Overtime rate.
8.223 Apprentice rate.
8.224 Skilled rate.
Appendix No. 2.
. 3 Traae
6.: 'J UIni,'-n contract rate.
Standards of safety and health.
Equitable readjustment of xsages above the minimum.
Bases of applications for stays of labor provisions.
Analysis Vf industries wnich r'.ere subject to stays of
Develoo:.',e-it of ILr.bor policy "ith respect to stays.
Lec .-.- aspects of labor ,-rovision stays.
Evaluation of e:-xoeriences.
General analysis aid discussion bf trade practice
provisions witi respect to stays thereof, the provisions
bei.ig grouped as follows:
B.311 Generally accepted in law.
8.312 Desirable but .ot fully accepted in law.
0.313 Desirable but no basis in law.
Apoendix No. 2.
8.32 Code Authority rules and relations having force and
effect of trade jrzctice rules.
8.33 Price policy.
S8.331 Price fixing.
8.3311 Fixed prices.
8.3312 Lowest reasonable price.
8.3313 Modal mark-up.
8.332 Price control.
8.3321 Loss leaders.
8.3322 Loss limitations.
8.333 Open price systems.
8.3331 Institution of system.
3.3332 Particular contracts.
8.3333 M: ethod of operation.
Note: For purposes of discussion bid depository systems are included
under tnis sub-division.
8.334 Cost provisions: -
8.3341 Sales below cost.
8.3342 Obsolete goods.
8.3343 Emergency disposals.
8.335 Accounting systems.
8.3351 Iecessity of approval of Administrator.
8.3352 Complexity of system.
8.3353 Difficulties of installation.
8.336 Sales reporting systems.
Appendix No. 2.
3odc Aiutnority )rov.isijns.
9.1 R-rr.ts of Cod Aat.i-ority.
'.2 Obli.:ticns an.: duties -f Cod: Autnority.
9. 1 Optional.
v.3 Use of stay to enforce.
9.31 Reorescntative elections.
9.32- Preveition of undue association oarticioation.
Zode Authority financed.
11.1 Bases of ao;lications.
11.2 Use of stay for
11.3 Efliect of stays grated.
12. Statistical reports.
12.1 Ec-cutive orders of general ap1l-ication.
12.2 -asns of' a. 1-cations.
13. Conditional orders of atporoval.
13.1 ikLture cof stay, granted.
13.2 Effect ua.:on conditional order.s.
13.3 Effect ucon policy and general code structure.
l1. Liiscellaneous code -rovisions subjected to stays.
15. Government contracts.
Aopendix No. 2.
15.1 Executive Orders u6o7 : -ii 6,-o.
15.2 Stays of codes provisions causca by Government contracts.
15.3 Nature anu effect of stays for government contract purposes.
16. Period of stay.
16.1 Duration of Act.
16.2 Duration of code.
17. Types of orders, etc., other than coach provisions ;iuich tvere
subjected to stays.
S 17.1 Ececutive orders.
17.2 Administrative orders.
17.3 General rules and regulations.
18.1 Sourc- ofC apJlication.
18.11 I .adustry.
18.13 Governmenntal agfnoies otiner tnan N.R.A.
18.2 Application directed to
18.22 Field offices.
18.23 Code Authority.
18.24 Other governmental agencies.
Appendix No. 2.
lu.3 Considcration by .a.R.A. of aojlic:tion.
18.33 Due process.
18.4 Final action on application.
Stays institutc-d by .R.A.
19.1 Base-s of action.
19.14 Rpco'Tnition of recomr.iendations of advisory boards.
19.2 Analysis of industries and provisions stayed by N.R.A. on
its o'wn motion.
19.3 Effect of stays instituted by :T.R.A.
19.33 Consu iors.
Po aer of subsequent modification or termination.
20.1 L;.r.A. initiation.
20.2 Ap-lication by industry.
Ap endix Yo. 2.
20.3 Appllcation by labor.
20.4 Application- by consumers.
20.5 Application by Code Authorities.
20.6 Bases of application.
20.7 Effects.of modification or termination.
LIST OF C3DES WiHCH "TERE S13J'::CTD TO A STAY OF
SO.i oC.1 ALL JOF THE T-ADB ?RAC-ICE P2OVISIJNS
THIrEdlY Ili TiH Oa-DEZ-S OP AIPPAOVAL Ox SUCH CODES
CODn. i0. .'..OF CODlE
96 Bufl and Polisning hneel
124 ..otioa Picture
182 2etcil Food Z Grocery
196 ".noles.-le Fo.,d L Grocery
202 Carpet a& ARug Manufacturing
204 Plumnbing fixtures
236 Cooking & ie: ting
237 Alloy 3astin''
239 Porcelain Br,.-a'cakfast Furniture Assembling
240 Advertising Display Installation Trade
241 Chewing Gum manufacturing
243 Slide Fastener
84-2 Hand Chain Hoist
84-3 Chain manufacturing g
64-4 Electrical Iiidustrial Truck MIa.aufu-.cturing
245 crrl-:.t.. & Solid Fibre Shipoing Container
246 Paper Disc .,ilk Bottle Cap.
247 Foid Dish & Pul-o & Pacer Plate
248 Glazed and Faicy Paper
249 Tag Industry
?50 Tiru, iod & Tube Die
232 Cylindrical Liquid Light Paper Container
257 a Printing Eqiiu.nent
259 Hat Manufacturiing
260 Ornamental Aouldin;, Carving & Turning
261 Poiu idry Suap3ly
263 i.acnine Knife & Allied Steel Products
268 Secondary Aluminum
269 Carbon Black
270 Wood Heel
272 Unit Heater .nd/or Unit Ventilator
274 Saw & Steel Products
286 Beauty ana Barber Shop
287 Graohic Arts
289 Cloth Reel
290 Photographic iaount
291 Wood Cased Lead Pencil
293 ,umming Inaustry
294 Gummed Label & Embossed Seal
295 7aterprcof Pager
NAME OF CODE
- Fluted Cup, P:n Liner & Lace Paper
- Sample Card
- Outdoor Advertising
- Fibre Can & Tube
- Stay Manufacturing
- Ready Mixed Concrete
- Steel Wool Industry
- Industrial Safety Equipment
- Horseshoe & Allied Products
- Machine Applied Staples & Stapling Machine
- Upnolstery Spring & Concessions Mfg.
- Bulk Drinking Straw, Etc,
- Canvas Gcods
- Beverage Dispensing Equip.
- Fibre & Metal lork Clothing Button
- Fullers Earth Producing
- Preformed Plastic Products
- Photogra-ohic & Photo Finishing
- Clay Drain Tile Manuftfcturing
- Sand Lime Brick
- Metal Treating
Expanding & Specialty Paper Products
- Open Paper Drink, Cup & Round Nesting Paper Food Container
- Sanitary Milk Bottle Closure
- Tool & Imolement
- Hack Saw Blade Manufacturing
- Forged Tool Manufacturing
- Cutlery, Manicure Inolement & Papers & Paper Hangers,
Tool Mfg., etc.
- Power & Gang Larn Mower
- Tackle Block Mfg.
- Reclaimed Rubber Manufacturing
- Peanut Butter
- Transparent l.ateriaLs Converters
- Railroad Soecial Track Equinment
- Umbrella Frame, etc.
- Insecticide & Dise.nfectant
- Lightning Rod Mfg.
- Spray Painting & Finishing
- Household Goods Storage & Moving
- Bleached Shellac M.anufacturing
- Boatbuilding & Boat Repairing
- Flexible Insulation
- Retail Rubber Tire & Battery Trade
- Loose Leaf & Blank Book
201- 4 -
3C8- ? -
275- 1 -
275- 2 -
308- 5 -
347- 6 -
2C1- R -
347- 8 -
NA!2 OF CODE
Bobbin & Snro&l
Lnpthr Cloth & Lprnqusr-d Fpbrirs
PForcolain Enpnelint- lift.
Non-.Wrrrnvs Hot 'lptr .Tank
Trnnch :I nufncturing
Beruty & Bprb-r Equiirnnnt
Snar Fpstonpr !'fg.
Soft Lime Rocki
!-.arblA Qu.arrving & Yurnishing
Ppuer Mnkers Felt
Snenip1t'y Armt. Su'l-i-y
Shoe Pattern 'Ifg.
Screq- Machine Protducts
Agricultural Insecticide & Funmicide
Cpo Scrpr7 lfg.
M.nchine Screw Nut
Bright Wire Goods Mff.
Drpnery & Cnrmet Hard.'-are
Mpchine Screw Ifg,
Wood Screw U.Ifg.
Beptes & Jordan & Allied. Products
'Tholesalo Dry Goods
Ste!l PpckaFge I:fg.
Standard Stpol Bprrtl & Drum
'Tpter ]'-!ter !.fg.
Ice Cream Cone
Preserve, Maraschino Cherr- & Glpce Fruit
Wholos-ple Tobacco Trpde
Galvanized Tqro HIfg.
Job Galvpnizing Metsl Coating
7pshing Machine Parts
Milk & Ice Cream Can Mfg.
Wrrm Air Furnace Mfg,
Hog Ring & Ringer Mfg,
Flexible Metsl Hose & Tubing
Wire Rone & Strand
- Di!',mvnd Core Drill
- i.,C.ch-nib c,]. Lui.oricr-tor
- Cont, -ctnrs Funp
- :",atcr'o'-'or Equi-'.nont In..ustr"
- Rollir. : 'ill iL'chi.'jry
- Cutting Die Ifg.
- Pulverizinz I'ichincry
- Fur Thclesalinz & Distributing
- Stocm Engine Mfg.
- Rock & Ore Crushing
- Redudction Machinery
Coc & Chocolote LIfg.
- Retail Tobacco
- Cig.' r I'-Cnufacturing
Sulihonated Oil Mfg.
- Trailer Mfg.
- WnLm.' Air Re:istcr
- Hoist "Builders
- Hoistir-ng Engine If.
Kiln Cooler & Dryer :.Jfg.
- Cenve-or & U!;?terinl Prnmrrtinn Material
- Lift Truc.k :. Port-ble Elcvptcr
Automobile Hot i'hter H,-tc-r
- Artistic Lighting, Equiiment
- FRe-ilcement ;xlc Shaft
- Complete '.ire & Ircn Tence
Roller & Silent Ch-in
- School Sunrlies & Ecuipment
- Public Senting
- ColC St3or.g3 Doer I:f,-.
- Cotton Ginning M.Lchincry
Safety RIzor & Sn'fct",, ;or Bla-de -l.
- ImnortL-d Datu Pc.c':inr
Cut Toc'-., 'TirE T-c" & Small Stm.le 1.,f-.
- Po,.er Transmission
Caster & True' Floor Hfg-.
- VpItcr Softener 1 Filter
- Open Steel Floorin;
- Multip-ile V-Belt Drive
- Athletic Goodc. iIfg.
S Leif Srring 1.1fr.
- Envelope Machine Lif,.
- Air Filter
- GPs Po\verod Industrial True'.
- Sprocl:et Chain
- Vitreous Enameled '.Tpre
- Stereotype Dry 1,[-t
T:A.E OF CODE
CODE I0. V. NAME OF CODE
201-14 -'oolLns & Trimnii-s' Distributing
347-35 Oil Field Punping Engine Mfg.
38- 2 Filing Supnly
88- 1 Fire Resistive S- 347-36 Rufrigersting Machinery
347-37 Concrete 1,ixer
347-40 Diesel Engine l.'fg.
347-38 Jac'- Mfg.
347-39 RpilWAy Ap-oli-nce Mffc.
347-41 Hydraulic Ic.chinery
507 Surgic8! Distributors
508 7hnclesnle Pluibinr Products, Hc'ting Prcducts. etc.
275- 3 Industrinl Alcohol
509 ':Prine Eouipment Vfg.
511 Corrugated Rolled 1iet.-nl Culvert Pipe
84-Ann.- 1 Fly S.watter Mfg.
84-48 Perforating Mfg.
84-53 Tubular Split & Outside Pron.;ed -ivet itfZ.
.34-53 Liouid Fuel Ap-olirncc
34-54 File I.fg. ..
LIST OF STAYS ISSUED SL'BSIQWE-TT TO CODE
APPROVAL CODE PROVISIONS CITECTED -
R*,AS C TS TF-&ZCECR
CUDE 2-*OVIS ION
Shiprep i ring
, Cast Iron Soil Pi-oe
Lugr-a e & Fancy
Hours (Sat. closing)
Hours (for certain
Normal hours and over-
Normal hours and over-
Machine hours (Barmens
Nornr' l hours
I'o 'mq 1 hour s
I:3"- chiL -, 'J"u s
:Tormal, weel- -,eriod
Normal wee'- neriod
Normal Week Period
i.inimuxn rage outside
salesmen and drug store
To start produc-
for testing in-
To enable em-
ployees to learn
other skilled op-
Pssure steady em-
Scarcity of skilled
help and peak de-
ScnrcitY of s':illed
help and peak de-
Scarcity rf s'-illed
help and poak de-
- I- (Continued)
LIST GOF STAYS ISSUED SUBSEQUENT TO CGE3
APPROVAL CODE PROVISIONS AFFECTED -
COIE CODE PROVISION REASON
ITormal Dny period.
",ore than one hou
Relief for smsll
towns of 2500 or
Consecutive hrurs for Inventory.
specially sk-illed em-
- II -
CooLt rind Suit
1 memberr rf Code Autho-Pending amend-
rity, selected from rent.
Infants r-nd CoPts assn.
Rules of Practice
Rules of Practice
(for nliece goods)
Unfair methods of
tion to competito
and no useful nur.
Cont and Suit
Sp r inkler
Quotations or sales on Demoralized con-
invitstion to bids edition of industry
Method of Assessment
lrnufncture qnd srle
of shellac )nd: varnish
Sgles belor cost.
Non-represent t iv
character of Code
dules not extended
Busin-ss Furniture, Prohibitin: -onrice guar-Relief to U.S.
Stor,-Le Eouipnment,ctc.antee anC" s'le belo' Government
9S-7 Busines Furr.its.rc,
S-1S Business Furniture,
Storage &.quti .e',it,
SS-25 Business Farniture,
Storage LqulpnnK rt,
151-25 M illinery
Snles below publish-
ad prices to U.S.
Days per week as ro-
plied to shipping
fays rer woek as .m:-
plied to shin.Aing
Time and one-half
Daily hours and
Relief to U.S. Govern-
Impractical to deter*.
uine whether prices
conform to code.
Relief to U.S. Govern-
Unfair end disa-
Ii,"r,:e up tiie lost
Men' s ITecl:keare
Wage cxeription for
Prr -vi-inr-,n creates
confusion and in-
Continuation of stay
in Executive Order of
Operating at a loss
Work on Armistice Day.
Unable to pay code rages
and remain in business
467-45 Cigar Mfo.
60-105 Retail Druag
Minimum wages for
drug store delivei-"
Lincolnt s Birthday
Confusion in ap-
plication of prov-
IXEMPTIOS A2D EXCEFTI0iIS
D. L. Bolaind
The purposes of this study are to disclose the question, problems,
limitations and deficiencies relating to exemption and exceptions which
were presented to or imposed upon the Naticnal Recovery Administration
in its capacity v3 a governmental agency charged with the formulation,
promulgation and administration of codes of fair competition under the
terms of the National Industrial Recovery Act. (*) The report endeavor
to treat certain phases of the above matters. which, in the opinion of
the author of the report, are of primary importance. These phases are
concerned with the National Industrial Recovery Act and the bases of
power therein contained with respect to the subject of exemptions and
exceptions; the delegation of such power; the necessity of such delegate.
and a recaoitulation of the exercise of such powers, both administrative
The report attempts to present an explanation and analysis of the
various kinds of exemptions and exceptions. The extent of the analysis
covers the causes of the application or applications or Initiations
thereof, the considerations had thereon by the National Recovery Admini
tration and the nature of its decision.
The bases of the findi.:gs set forth in this report result from an
investigation of the files and records of the nationall Recovery Adminis
tration and its official orders which relate to exemptions and exception
Lack of time an( personnel prevented an investigation of all the record
of the administration relating to this subject, so for purposes of this
preliminary report a selected list of codes was drawn up, such list
being made upon the basis that an examination thereof would disclose in
the main a cross-section of American industry and also a fairly represent
tive and reasonable picture of the problems and questions presented to
the Administration in connection with the subject of exemptions and ex- j
ceptions. The list of codes is as follows:
LIST OF CODES EXAMINED.
Shipbuilding and Shiprepairing
Coat .and Suit
Corset b.n-' -.rnssiere
Legitimate Fall Length Dramatic and Musical Theatrical
Lumber mnd Timber Products
Iron and Steel .
Ravon and Syntheti Yarn Producin
(*) 48 Stats. 195
'*-.. "'*! .* **Q
LIST CF CD!S CXAAI!fIED (Continued)
Auto;no'bile Maiufac turizir,
Cast Iron Soil Pipe'
Wall Paper IanmufacturingL3
Motion Picture Laboratory
Underear and Allied Products Manufacturing
SGasoline Pu.ip ILanufacturing
-* Artificial Flower and Feather
;, Linoleum and F7It Base M1anufacturing
Knitting, Braiding; and Wire Covering Machine
SRetail Lumber, Lurnber Products, 3buildCing 'i,,terials and Building
Laundry' and Dry Cleaning Kochinery M.inufa.cturing
Textile Machinery ,?,uf.fctari.-g
SBuilders Supplieti Trade
Electric Storage and Wet Primary Battery
Luggage and Fanc:y Leather Goods
Boot arid Shoe Manufacturi:-g
SSaddlery MinufEac turning
SMotor Vehicle Retailing Trcd.e
Optical Manufacturing ..
i Mutual Savings Banks
Cap and Closure
Paint, Varnish and Lacquer Manufacturing
Business Furniture, Storage Equipment rnd i].ing Supply
Asphalt Shingle and Roofing lManufact u'irng.
LIST OF CODES EXAMINED (Continued)
Paper and Pulp
Wholesaling or Distributing Trade
Schiffli, the Hand Liachine Embroidery, and the Embroidery Thread
and Scallop Cutting
Men' s 1eckcwear
The objectives of this study have been mainly concerned with the
problemm of legislation, keeping in mind at all times the content of the
President's letters to the chairmen of certain committees of the Congress
with respect to suggestions for future legislation embodying the prin-
ciples of the NRA. As a result, the author of the study has concerned
himself with the experiences of the National Recovery Administration with
exemptions and exceptions as a legislative question, the extent of the
power to grant exemptions and exceptions, the limitations upon such power,
the methods of use and exercise of that power, the methods of the dele-
gation of such power, and constructive suggestions as to the subject in
general. The outline of the study which is attached hereto is much more
comprehensive and includes phases of the study which are not made part
of this preliminary report, some of which are problems of procedure, ad-
ministrative detail, relationships with other governmental agencies,
more critical analyses of the subjects of this report and evaluations of
experiences relative thereto. This preliminary report is rather con-
cerned with the more important and substantive subjects hereinabove
:To attempt has been made to extend the scope of the study or the
sources of material thereof beyond the actual files and records of the
National Recovery Administration. These records do not include those
of code authorities, other governmental agencies, or private individuals.
No conferences have been had with any such agencies or individuals. In
short, it is the intention of this report to present in preliminary form
some answer to the question What did the National Recovery Administra-
tion do in the exercise of its power to grant or deny exemptions from
and exceptions to code provisions? Again, it is the intention of this
study to present in likewise preliminary form some answer to the question-
What should any future governmental agency embodying the principles of
NRA be empowered to do with respect to exemptions from and exceptions
to code provisions?
2.LS-3 L ? P02 3R
The Nationdl Industrial Rhocuv-ry Act (*) became law on June 16,
1933. Title I of such Act relatri to industrial recovery, and provided
in general for the set-up of various codes of fair competition.
Section 3(a) of the Act st-..tes as follows:
"Upon the application to the President by one or more trade
or industrial associations or groups, the President may approve
a bode or codes of fair competition for the trade or industry
or subdivision thereof, represented by the applicant or
applicants, if the President finds (i) that such associations
or groups impose no ineqtUit.'ble restrictions on admission to
membership therein and are truly representative of such trades
or industries or subdivisions thereof, -and (2) that such code
or codes aro not designed to promote monopolies or to elimi-
nate or oppress small enterprises and. will not operate to
discriminate a='ainst them, and will tend to effectuate the
policy of this title: Provided, That such codW or codes
shall not permit monopolies or monopolistic practices:
Provide' further, That wvheire sic'i code or codes affect the
services and welfare of 'pe.,sons engared in other steps of
the economic process, nothing in this section shall deprive
such persons of the ri'ht to be heard prior to approval by
the President of such code or codes. The President may, as
a condition of his approval of any such code, impose such
conditions (including requirements for the making of re-
ports and the keeping of accounts) for the protection of
consumers, competitors, employees, and others, and in
furtherance of the public interest, and may- provide such
exceptions to and exemptions from the provisions of such
code, es the President in his discretion deems necessary
to effectuate the policy herein declaredd"
It is to be noted that un6er the terms of this particular
section the President was delegated certain power to
"* * impose sucn conditions (inclu'inng requirements
for the making of reports and the keeping of accounts)
for the protection of consumers, competitors, employees,
andc. others, and in the. furtherance of the public
interest, and may provide such exceptions to and ex-
emptions from the provisions of such code, as the
President in. his discretion deems necessary to effec-
tuate the policy herein declared."
(*) Public Resolution No. 67, House Rasolution No. 5755, 73d Congress,
48 Stats. 195
It is apparent f.-om this particular section that Congressional dele-
gation of power had been made up to the President to grant exemptions
and exceptions from the provisions of codes approved under the pro-
visions of the said Section 3(a). This sentence gives the President
power to do two things:
(1). To impose certain conditions: and
(2) To Irovide exceptions and exemptions.
As to the first, it says he "may, as a condition of his approval
of any such code, impose such conditions".
As to the second, it is said he "may provide such exceptions to
and exemptions from the provisions of such code, etc."
A careful readin.-, of the grant of power reveals that the clause
"as a condition of his approval of any such code" surrounded by commas,
is interposed between r'nnand "impose", whereas later "may" is again
repeated and placed just before "provide" without any such interposition#
It must follow, therefore, that the very language of the act is such
that no time condition is expressed, limiting the power to grant ex-
ceptions and exemptions.
Section 4(a) of the National Industrial Recovery Act provides as
"The President is authorized to enter into
agreements with, and to approve voluntary agreements
between and among, persons engaged in a trade or
industry, labor organization, and trade or industrial
organizations, associations, or groups, relating to
any trade or industry, if in his judgment such agree-
ments will aid in effectuating the policy of this title
with respect to transactions in or affecting interstate
or foreign commerce, and will be consistent with the
requirements of clause (2) of subsection (a) of section 3
for a code of fair competition."
This section contemplates the creation of voluntary agreements
between the President and various groups, but exercise of the autho-
rity is subsequently conditioned upon the requirement that the agree-
ment is consistent with the provisions of the second clause of
Section 3(a) herein-above set forth. This clause refers to monopolies
and it may be argued that the authority conferred upon the President
by Section 3(a) to grant exemptions and exceptions from the provisions
of codes n pplies to Section 4(a) agreements insofar as monopolies and
oppression of small enterprises are concerned.
Section 7(b) of the Act is as follows:
"The President shall, so far as practicable, afford every
opportunity to employers and employees in any trade or industry
or subdivision thereof with respect to which the conditions
referred to in clauses (1) and (2) of subsection (a) prevail,
to est:,blish by mutual ngrc-.jmc'nt, thu starr4.rds as to the
maximum hours of labor, 'ini-um ratcas of pay, ahua such other
conditions of Iemplou.-.'n as y." L nLcjiszryf in suc5, tride
or industry or subDivision tlwreof to effectuate the policy
of this title, and the stand'l,'a-rds established in such agree-
ments, when approved by the ircesidrnt, shall have the same
effect as a cod.. of fni co rujo.-t tilon, p"proverd by the
President i1nder ubioection (a) of section 3."
Section 7(c) of the Act provides:
"Where no such mutual agreement has been approved by, the
President he may investigate the labor practices, policies,
wages, hours of labor, and conditions of employment in such
trade or industry or subdivision thereof; and upon the basis
of such investigations, and after such hearings as the
*. President finds advisable, he is authorized to prescribe a
limited code of fair competition fixin, such maximum hours
of labor, minimum rates of py, und other conditions of
employment in the trade or industry or subdivision thereof
investigated as he finds to be necessary to effectuate the
policy of this title, which shall have the same effect as
a code of fair competition approved byr the President under
subsection (a) of section 3. The President may differentiate
according to experience and shill of the employees affected
and according to the locality of employment; but no attempt
shall be made to introduce any.v classification according to
the nature of the work involved --hich might tend to set a
maximum as well as a minimum ,'age."
The above twvo sections contemplate circumstances under which
maximum hours bof labor and minimum ri-tes of pay and other conditions
of employment might be made the subject of an agreement between the
President, employers and employees of any trade or industry or sub-
division thereof or tne occasion of the exercise of the power by the
President to prescribe a limited code of fair competition as to
maximum hours of labor, minimum rates of pay and other conditions of
employment. The agreements so contemplated under the terms of
Sections 7(b) and 7(c) necessarily were to be considered as having
the same effect as a code of fair competition approved under the pro-
visions of Section 3(a). The effect of this declaration carried the
full authority conferred in Section 3(a), which, as hereinabove
mentioned, conferred upon the President the power to grant
11* * exceptions to and exemptions from * the provisions
of such codes *"
Tho administration of the Act necessarily required. some latitude
of administrative discretion. The provision made therefore was Section
10(a) of the Act, which is:-
"The President is authorized to prescribe such rules
and regulations as may be necessary to carry out the pur-
poses of this title, anM. fees for licenses and for filing
codes of fair competition and agreements, and any violation
of any such rule or re-ulntion shall be punishable by fine
of not to exceed $500, or imprisonment for not to exceed
six months, or both."
Section 10(b) provides:-
"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 compe-
tition, or license approved, prescribed, or issued under
this title shall contain an express provision to that effect."
The power conferred upon the President by these two sections
permitted discretion in the grant or denial of exemptions or exceptions,
authorized the creation of rules and regulations relating thereto and
the cancellation and modification of any order, rule or regulation.
These sections enlarge upon the po.'er conferred to grant exemptions
and exceptions with the further additional requirement that each code
contain the express provisions of Section 10(b), which seems to be the
safest to rest the power to grant exemptions and exceptions.
The power conferred upon the President as set forth above is
broad and subject to few limitations. These limitations are expressly
set forth as follows:
In Section 3(a) -
"for the protection of consumers, competitors, employees
and others and in the furtherance of the public interest
* as the President in his discretion deems necessary
to effectuate the policy herein declared."
Section 7(b) provides -
"as may be necessary * to effectuate the policy of
this title; *."
Section 7(c) provides -
11* as he finds to be necessary to effectuate the policy
of this title."
Likewise Section 10(a) contains a limitation upon the exercise of
administrative discretion -
"as may be necessary to carry out the purposes of this title".
An examination of Section I., Ti..lj I, of the National Industrial
Recovery Act discloses a 1,e t:_ .i d.cl.'-,,tion of the existence of
a great national emerency, )nd ,.ii.: L various widespread problems and
conditions in American industry an'd lnbor v.hich, through the extent
of their seriousness ari, effect nccsiaril.' required the exercise of
great administrative discr. tion on thie pr,,r of the person charged with
the administration of the law. These legislative declarations set
forth the policy and purposes of thj Act and as such constitute the
Standards to which the President -,as required to adhere and act as
limitations upon the grant of power hereinbefore mentioned.
The legislative history of the NT.A is particularly meager upon
the question of exemptions and exceptions to codes. An examination
of the committee reports in both Houses, the hearings before those
, committees, and. the debates in Congress upon the submission of the
Recovery Bill itself furnishes onl'- slight support to any policy of
making exemptions to the operation of codes. However, such material
as may possibly be regarded as bearing upon the point is herewith set
Regarding Section 7(c) of th Act, Mlr. Richber, had this to say
before the Committee on Wr,;gs rd i.a.as of the House:
". I will just refer :,'ou to the next section on page
8, where the Presidnt is authorized, where no mutual
3 agreement has becn approved, to investigate the conditions
and to '"st; .bliEh a 'lilrit, c;- of.ai:& cO-..hitition which
fixes maxinmurm hcL.rs of-..o.. nrirn:-n rates of Iay, and'
other working conditionss; and on page 9 the specific
provision is made that tthe President may differentiate
according to experience: ard kill of the employees affected
and according to the locality, of er-mployment' And that is
the thought which -uIns th,-oughout the bill, as I understand
it." (Page 71, M.ay 18, 1933).
Concernincz the srine sertion of th'3 Act, Senator Wagner had this
to say before a hearings of the sane com-nittee:
W . here no agreement can be rR-c:ied or has been
approved, the President is authorized to investigate and
to prescribe by wa; of a limited code or as a part of a
general code the standards, of hours, '-ngas and conditions.
"Of course, in those cases, in his investigation he must
take into consideration the locality, difference in the
cost of living in certain localities, and other matters
which enter into a determination of hours and wages and
Conditions, with which we are all familiar." (MIay 19, 1933).
As finally passed, Section 7(c) of tne Act :iv-s definite sanction
to a differentiation -
"accordin; to experience and s'kill of the employees affected
and according to the locality of the employmentt"
Therefore, the meaning of the Act upo:, this point seems to have been
well presented at the foregoing committee hearin..
Concerning Section 4(a) of the Act, Senato: Wagner said at the
hearing before thu Committee on Finance of the United States Senate:
".... In ad-ition to the voluntary coCe, anC the compulsory
code, there is also provision that a portion of an industry
may enter into some agreement that is different f.Lom the
codes, because thie government takes it 3ut of the code for
some specific purpose. For instance, in some locality
conditions exist that do not exist within the trade gene-
rally, a d that may require, rather than an exception in
the code, a definite agreement butwoen. the Governnent and
tht- individual industry." (Page 3, ly" 22, 1933).
This reco,-nition of diffrerentiation by locality applies only to
the agreem-nt features, and does not by its terms apply to voluntary
codes and compulsory co6es.
The followin- brief colloqur between Senators La Follette and
Wagner at another hearing before the same co.-mmittee relates to Section
10(b) of the Act:
Senator La Follette. "Senator Wagner, did you and your associates
consider the advisability of conferring power upon the President
to amend or revoke these codes of fair competition in cases where
it was demonstrable that the public interest was being injured
by tneir continuance?"
Senator Wagner. "That is ri&ht in the act. He may modify,
cancel, or do anything to the order.
Section 10(b) of the Act seems to be the safest reliance in
justifying exemptions and exceptions to codes. The wording of the
Section is so broad that the President seems clearly to have the
pov'er of granting exemptions and exceptions.(*)
The report of the House Committee on Ways and Means upon the Re-
covery Bill has little to say which bears upon the subject of exemptions
and exceptions. The following are the only excerpts from the retort
which are in point:.
(*) It is intere-sting to note that the Administrator assumed he had
power to grant exemptions See Office Order, December 7, 1933 -
although the powers conferred by Section 10 had been reversed by
the President (See Executive Order 6205-A) NRA files.
- 77 -
n. If codes, s "o-.:ic'.ts, or liceca('- rrovc faulty, the power
is reserved to the Prcsiz .it, -di.c:r ctinn 9(b), to cancel or
modify any order, a-))rov-l, license, rule or regulation issued
under this title."1
Section 9(b) leter became Section 10(b) as finally envctAd:
.*. Whereas a code of fair competition will bc made for an entire
trade or industry anc itust be aaiBe by those truly representative of
the trade or industry, these voluantiry agreements can be entered
into by parties in an industry or in more than one industry. The
code binds all persons engaged in a trade or industry, but an ajree-
ment binds only those-entering into it. Thus the provisions for
codes and agreement supplement each other and provide a thoroughly
flexible machinery of industrial operation." (Pages 3 and 4 of
House Report Ho. 159, supre). .
Of course, the last of' the foregoing excerpts merely explains the
difference between a code and a voluntary areeuent. If anything is to
be gained from this noortion of the report it would seem to be that codes
are presumed to be binding u'-on all members of an industry alike.
In the re-oort of the Senate CoinLittee on Finance u-oon the National
Industrial Recovery Bill there is nothing which relates to the subject
of exceptions and cxea;ntions. (*)
From the debates in Congress we likewise find little material. The
following excerpts from the Conrressional Record are substantially all
of the material which is relevant:
The Presiding Officer. (':r. Ie,.ly in the chair.) ". . The next
amendment Was, on page 7, line 31, after the name 'President,' to
insert shall find that destructive wane or -'rice cutting or other
activities contrary to the 'olicy of this title are being practiced
in any geogranhical area or in any subdivision of any trade or in-
dustry, and .'" (Pa,;," 5255, Senate, June 3, 1933)
IAr. Black. "Lr. President, there was an amendment pending to that
particular amendment. That wvs the pending question, as I under-
stood. The amendment was to strike from the amendment the words
'in any geographical areal" (Page 5255, Senate, June 8, 1933)
Mr. George. ". . If the Senator from M.ississippi is going to
insist upon it, I shall move to strike out 'in any geographical
S area orl on page 7, and the same language on page 8 of the bill."
See footnote on next nage.
Mr. garrison. "laxy I snu to the Sen.,tor from Georgia that
I -ui not injistinj ):rtic-aul--rly oil i'V pro,)osition in that
regard, because this ofenicCnt o Cfrod in tLic comit-
tee, and, of course, I 26el th.'.t I ouLnt to stand by the
action of the co:.mittec; bi.t Guner;tl Johnlmson, when hlie ap-
pecr.red. before tir cora-ittee, :.in he did not think it was
necessary as to this matter. I .skedl unanimous consent
for the reconsideration of the vote by which it was adopt-
ed in order to get the matter before the Senate, so that we
could dispose of it."11
M.r. George. "I make that motion, Mlr. President, and sug-
goat the absence of a quorum unless it is accepted."
Mr. Presiding Officer. "The absence of a quorum is sug-
gested. The clerk will call the roll." (Page 5259,
June 8th, 1933.)
After a roll call with 92 members answering, the foregoing dis-
cussion of licenses under Section 4(b) of the Act w7as continued. Sec-
tion 4(b) was finally passed without the provision as to geographical
The following remarks of MIr. Black illustrate the opposition to
the unsuccessful attempt to make the license features have a geograph-
". I strenuously object to ir.ving any one state marked
off with lines around it, and the statement made to the
public that there is an infection in that State in a par-
ticular industry. It seems to me that we should either
have the rules applied to an entire industry or that they
should not apply to it at all. I can see nothing fair, when
there might be an investigation of some complaint made about
one State, saying that we will require every person engaged
in the business in that State, drawing a line around it, to
be licensed, but that we will make no such requirement of
those engaged in the same industry in any other State..."
(Page 526, June 8, 1933)
This portion of the legislative history seems of doubtful value to
us because the license features of the Act were not exercised by the
President, and his power to license expired by the terms of the Act a
year earlier than the other provisions of the Act.
(0) See Report No. 114 of the Senate, 73d Congress, 1st Session.