Evening star., 1940-02-14
BY CARTER BROOKE JONES.

An arrangement whereby the Ma
tional Labor Relations Board rec
commended to the Reconstruction
Finance Corp. that disbursement of
authorized loans be withheld from
companies against which the board
had issued Wagner Act complaints
was disclosed today by Board Chair
man j. Warren Madden.
Mr.. Madden told the House COM
mittee investigating his agency that
the arrangement had been worked
out last fall after R. F. c. officials
had broached the question.
Committee Counsel Edmund NJ
Toland placed in the committee rec
ord a letter revealing the arrange
ment during cross-examination of
MI. Madden. The letter, from
Board Secretary Nathan Witt to
George R. Cooksey, R. F. G. secre-
tary, referred to a conference last
August of N. L. r. B. and r. F. c.
officials and added, in confirmation
I'VE will inform you whether a
charge has been filed with the
board alleging that the company
has committed unfair labor prac-
tices. We will then inform you
whether the boards investigation
Of the charge indicates that it can
not be substantiated or whether the
board has issued or will issue a
complaint based on the charge.
Would Ask Ban on Funds.
"In the event the board has is
sued a complaint against the COM
pany, or will do 50, we will request
you to withhold disbursements un-
der the loan that has been au-
thorized.
subsequently, after the hearing
based on the complaint, we will in
form you as to the boards final
decision in the case.
IF the board finds that the en-
ployer has not engaged in unfair
labor practices, we will suggest that
you resume disbursements under the
loan. If the board finds that the
employer has been guiky of viola
tions of the National Labor Rela-
tions Act, we will recommend that
you continue to withhold disburse-
ment under the loan.
"We will of course keep you in
formed of any action of the courts
which affect the boards rulings in
such cases."
Acticn Remains Obscure.
A letter acknowledging this one in
formed the boards secretary that the
directors Of the r. F. C. so under
stand the informal agreement-that
the r. F. G. was to receive this in
formation in board cases.
Whether the r. F. C. acted in such
cases was not brought out.
The committee counsel disclosed
this phase Of the alleged black list
Ing" of companies-as he called it
after eiciting from Mr.. Madden that
the chairman had recommended to
the Procurement Division of the
Treasury Department that it with
hold Government contracts from
companies found by the board to
have violated the Wagner Act-and
In one instance, from an employer
who had only been charged and
had not received a hearing.
Chairman Madden admitted later
the Controller General held the
Government had no such authority.
Procurement Division Involved.
In reply to the charge of Mr..
Toland that Mr. Madden had tried
to blackjack" corporations in the
matter of Government contracts,
the board chairman said today these
letters had been invited by the con-
tract-letting branch of the Gov
ernment.
In two such instances placed in
evidence, Mr.. Madden said, repre-
sentative of the Procurement Divi-
sion went to his Office and asked for
letters.
Asked by Committee Chairman
Smith on what theory the Govern
ment could withhold contract from
q low bidder who was charged with
or convicted of unfair labor prac-
tices, Mr.. Madden said:
Il suppose as matter of sense
and common reason"
'Oh, no, we are governed by stat
|autes," said Representative Smith.
Sees All Federal Rule Coercive.
Referring to two cases in which
companies had been found guilty