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The Fair Labor Standards Act was passed by Congress June 14, 1938, and approved by the President June 25, to become effective in 120 days. created a Wage and Hour Division in the Department of Labor, headed by an Administrator, as the agency for the administration and enforcement of the wage and hour provisions. It assigned the administration of the child labor provision to the Chief of the Children's Bureau in the Department of Labor.

The United States Supreme Court unanimously held (Feb. 3, 1941) that the Fair Labor Standards Act of 1938 was a valid regulation by Congress inder the Commerce Clause of the Constitution, ind that the procedure of the Wage and Hour Division in appointing industry committees and 'ssuing industrial minimum wage orders on their recommendations is in accordance with the Statute.

Controversy over the effect of the 40-hour week. with its penalty of time and a half for additional hours, on the National Defense effort developed in 1941. However, William S. Knudsen, DirectorGeneral of the Office of Production Management. publicly favored its retention.

Pending the fixing of a minimum wage for each industry through the industry committee process. the statutory minimum wage rate must be paid all workers covered by the Act. From October 24, 1939, to October 24, 1945, the Act fixes 30 cents an hour as the minimum wage. From October 24, 1938, to October 24, 1939, the statutory minimum wage was 25 cents an hour. On October 24, 1945. 40 cents an hour becomes the minimum wage for all industries covered unless it be shown for an industry by a preponderance of evidence before an industry committee and the Administrator that such a wage would substantially curtail employment in that industry.

The standard work week was established at 44 hours from October 24, 1938, to October 24, 1939, and at 42 hours from October 24, 1939, to October 24, 1940, when the standard work week became 40 hours. All persons covered by the Act (except railroad employees and persons whose work affects the safety of interstate bus and truck operations) who are employed a greater number of hours per week than the standard must be paid for the excess hours at a rate not less than one and one-half times their regular rate of pay. In industries found by the Administrator to be of a seasonal nature owing to climate or other natural conditions, employees may work up to 12 hours a day or 56 a week (for not more than 14 weeks a year) before overtime payment is required. relaxation of the overtime provisions is also made in the case of certain collective bargaining agreements with representatives of employees certifled as bona fide by the National Labor Relations Board, and in the case of certain agricultural processing and handling operations.

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In the fiscal year ended June 30, 1941, 48.449 inspections for compliance with the Act were made by the Wage and Hour Division, eleven times as many inspections as were made in the two previous fiscal years combined. These inspections revealed 31,493 employers in violation of the Act. 18.975 of the violations being of so serious a nature as to require the restitution of $10,916,527 to 354,271 employees.

During the same period 1,691 civil suits for injunctions to restrain violations of the Act and 60 criminal prosecutions were instituted. In criminal cases tried during the year, $99,767 was paid in fines. The Division was successful in all but half a dozen of its litigation cases.

To reach as rapidly as is economically feasible

the objective of a universal wage of 40 cents an hour, the Administrator is required to appoint and convene a committee for each industry subject to the Act. It is the duty of these committees to recommend, with due regard to economic and competitive conditions, the highest minimum wage up to 40 cents an hour which will not substantially curtail employment in the industry. The membership of each committee is equally divided among members representing employers and employees in the industry and the public. After a public hearing on a recommended minimum wage, the Administrator may issue a Wage Order establishing the recommended rate for the industry; he may require the committee to reconsider its recommendation, or he may dissolve the committee and appoint a new one to consider a minimum wage for that industry. In no case may the Administrator issue a wage order which does not give effect to the wage recommendation of a committee. An amendment to the Act enacted by the 76th Congress exempts Puerto Rican industries from wage orders issued for continental United States, and provides that wage rates lower than the statutory minimum may be established in Puerto Rico only upon the recommendations of industry committeees expressly appointed for the island.

Minimum wages at less than the statutory minimum wage may be fixed by the Administrator for learners, apprentices and handicapped workers.

The Act exempts from the wage and hour provisions all employees employed in an executive, administrative, professional, or local retail capacity or as outside salesmen (as those terms are defined by the Administrator); employees engaged in retail or service establishments, the greater part of whose selling or servicing is in intrastate commerce; employees of interstate air lines; employees in the sea food and fisheries industries; agricultural employees; employees of local weekly or semi-weekly newspapers of less than 3,000 circulation; employees of street railways and local bus lines; employees in the area of production (as defined by the Administrator) engaged in handling, packing, storing, ginning, compressing, pasteurizing, drying, preparing in their raw or natural state, or canning, agricultural or horticultural commodities or in making dairy products: and switchboard operators of telephone exchanges having fewer than 500 stations.

The immediate effect of the Fair Labor Standards Act was to raise to 25 cents an hour the pay of an estimated 300,000 employees of American Industry. At the same time it was estimated that it shortened the working hours of 1,300,000 workers. When the second step of the Act was reached October 24, 1939, it was estimated that 690,000 employees received pay increases to 30 cents an hour, and 2,382,000 had their work week shortened to 42 hours. The 40-hour week which went into effect October 24, 1940, shortened the hours of approximately 2,000,000 workers.

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More than a million workers, a large portion of them women, received wage rate increases as a result of these wage orders: For cotton, silk, and rayon textiles, 372 cents an hour. For woolen textiles, 36 cents. For garments, including knitted apparel, 40 cents. For full-fashioned hosiery, 40: for seamless hosiery. 36. For hats, 40, except straw and harvest hats for which the rate is 35. millinery, 40. For shoes, 40. For trunkline railroads, 36; shortline railroads, 33. For leather, 40. For pulp and primary paper, 40. For carpets and rugs of wool and wool-yarn, 40; of other fibers, 35. For luggage and leather goods. 35. For converted paper products, 40, 38, and 36, depending upon product. For embroideries, 3712. For portable lamps and shades, 40. For enameled utensils, 40. For drugs, medicine and toilet preparations, 40. For rubber products. 40. For gray iron jobbing foundry products, 40. For clay products, 34. For jewelry. 40. For wood furniture, 40. For lumber and timber products, 35. For gloves, 35; work gloves. 322. For handkerchiefs, 3212.

Section 12 of the Act, which is administered by the Children's Bureau, prohibits producers, manufacturers and dealers from shipping or delivering for shipment in interstate or foreign commerce, goods produced in establishments situated in the United States in or about which within thirty days prior to removal of such goods, child labor has been employed contrary to the minimum age provisions of the Act or regulations issued thereunder.

The Act sets a basic minimum age of 16 years for general employment and provides that a minimum age of 18 shall apply to occupations found and declared by the Chief of the Children's Bureau to be particularly hazardous for minors between 16 and 18 years of age.

As of Aug. 1, 1941, the following occupations have been found and declared to be particularly hazardous: occupations in or about plants manufacturing explosives or articles containing explosive components; occupations in or about any coal mine; occupations in logging, and occupations in the operation of any sawmill, lath mill, shingle mill, or cooperage-stock mill; occupations involved in the operation of power-driven woodworking machines; and the occupations of motor vehicle driver and helper.

The Act also provides for the employment of 14 and 15-year-old children in occupations other than mining and manufacturing under rules and regulations issued by the Chief of the Children's Bureau, which limit the employment to periods which will not interfere with schooling and to conditions which will not interfere with health and well being.

The only exemptions from the application of the child-labor provisions of the Act relate to the employment of a minor in agriculture while not legally required to attend school, to the employment of a minor as an actor in motion pictures or theatrical productions, and to the employment of a minor under 16 working for his parent or a person standing in place of his parent, in an occupation other than manufacturing or mining.

The Federal Trade Commission was created as an independent agency by the Federal Trade Commission Act of Sept. 26, 1914. This law was amended by the Wheeler-Lea Act of March 21, 1938, which broadened the scope of its jurisdiction and made more effective the enforcement of its provisions. Declaring unfair methods of competition and unfair or deceptive acts or practices in interstate commerce to be unlawful, the act empowers and directs the Commission to prevent persons, partnerships or corporations (except banks, common carriers, air carriers or meat packers, which are subject to regulation by other acts) from using unfair methods of competition and unfair or deceptive acts or practices in interstate commerce. The Clayton Act, the Export Trade Act, the Robinson-Patman Act and the Wool Products Labelling Act of 1939, effective July 15. 1941, delegated further powers and functions to the Commission. The general purpose of the Commission is to prevent the use of unfair practices so as to promote free and fair competition in interstate trade, to prevent the use of unfair and deceptive acts and practices therein and to investigate and report on various aspects of domestic industry and foreign trade. Special attention is given the use of false and misleading advertising generally and particularly with regard to their use in the sale of food, drugs and cosmetics.

By direction of the President, the Congress, at

the request of the Attorney General of the United States, or upon its own initiative, the Commission conducts investigations of a special or general character.

Recent investigations include the automobile, and agricultural implements, industries; agricultural income, distribution cost accounting for manufacturing and wholesaling and a series of industrial and financial corporation reports, while others presently in progress include those having to do with distribution methods and costs.

Other activities of the Commission having to do with national defense and the present emergency include the following:

The Commission is represented by its Chairman on the Price Administration Committee of the Office of Price Administration and Civilian Supply, and is cooperating and assisting in this phase of the work of the National Defense Program in the interest of the consumer and general public.

The Commission is further represented by its Chairman on the Economic Defense Board, concerned with developing and coordinating policies, plans and programs to protect and strengthen the international economic relations of the United States in the interest of national defense.

The Commission has consulted with the Army and Navy Munitions Board in the preparation of plans for wartime control of pricés, costs and profits.

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The Act directs the Commission to determine the actual legitimate cost of original projects, additions and betterments thereto and to determine their fair value as of the date of license or determination.

The Commission has jurisdiction over the transmission of electric energy in interstate commerce. the sale of electric energy at wholesale in interstate commerce, the exportation of electric energy to foreign countries and over all public utilities owning or operating facilities used for the transmission or sale of such energy.

The Natural Gas Act of 1938 parallels the Federal Power Act in general (except that there are no license provisions in the Natural Gas Act) and confers upon the Commission regulatory authority, similar in scope to that conferred in the latter Act, over the transportation and sale for resale in interstate commerce of natural gas.

The United States Information Service, now a Division of the Office of Government Reports, Executive Office of the President, was established in 1934 in response to the need for a central office through which questions on the Federal Government might clear.

The Service furnishes to the public, on request, factual information on the structure, functions, and operations of Federal departments and agencies, and serves as a central office to direct general inquiries into proper channels.

In addition, the Service assists all Government departments in serving the public through the direct routing of inquiries and general public business.

The Service directs persons desiring appointments or interviews to offices where these may be arranged.

For both the public and the Federal offices the Service compiles current directories and reference material not otherwise available and maintains files of Government documents and publications. The United States Government Manual and the Digest of the Purposes of Federal Agencies are publications of the United States Information Service. The Manual is an authoritative reference book designed to inform every citizen on the organization and functions of Federal departments and agencies. The Digest outlines briefly some of the information in the Manual.

The Securities and Exchange Commission was organized July 6, 1934. The Commission is composed of five members, not more than three of whom may be members of the same political party. They are appointed by the President with the advice and consent of the Senate for a term of five years. One of the five commissioners is annually elected chairman.

The laws administered by the Commission and its functions under each are:

Securities Act of 1933-The supervision of the registration of security issues and the suppression of fraudulent practices in the sale of new securities. Securities Exchange Act of 1934-The supervision and regulation of transactions and trading in outstanding securities, both on stock exchanges and in the over-the-counter markets.

Public Utility Holding Company Act of 1935The regulation of the financial practices of holding company systems controlling gas and electric utilities.

Chapter X, National Bankruptcy Act-The preparation of advisory reports on plans, and participation as a party, in corporate reorganizations.

Trust Indenture Act of 1939-The supervision of indentures used in the public offering of new security issues.

Investment Company Act of 1940-Investment Advisers Act of 1940-the registration and regulation of investment companies and investment advisers.

None of the foregoing statutes administered by the Commission guarantees investors against loss.

During the year the Commission adopted a mile under the Holding Company Act requiring competitive bidding in the sale of securities of registered gas and electric public utility holding companies and their subsidiaries. The rule was recommended by the Commission's staff after a number of years of study of methods to insure the reasonableness of fees and commissions and the fairness of terms and conditions in the sale of utility securities.

The proposals were the result of almost a year's study of the securities laws by members of the Commission's staff and representatives of the securities industry, which also involved extensive conferences between the Commission and the industry.

Facilities for the registration of securities under the Securities Act of 1933 and the qualification of identures under the Trust Indenture Act of 1939 were set up in the Commission's Cleveland and San Francisco Regional Offices during the past year. The Commission also amended its rules to permit the delivery of registration statements and indenture applications to any of its regional offices for forwarding to Washington. Most of the Commission's regional offices are equipped to give a certain measure of legal assistance on registration problems.

The Securities Act of 1933 is designed to compel full and fair disclosure to investors of material facts regarding securities publicly offered for sale, and to prevent fraud in sales of securities, when offered or sold in interstate commerce or through the mails. The Act requires that, with certain exceptions, every issue of securities to be offered for sale to the public through such means must be registered with the Commission by the filing of a registration statement.

There were 337 registration statements filed under the Securities Act of 1933 during the fiscal year ended June 30, 1941. Registration statements covering securities amounting to approximately $2.610,684,000 became fully effective during that period. The number of registration statements effective at the end of the 1941 fiscal year was 3,823, while the number of stop and consent refusal orders in effect was 175. The Commission examined 1,048 offering sheets relating to oil royalties, involving an aggregate offering price of approximately $23.600,000.

An important feature of the Securities Act is the protection which it affords investors against such outright fraud as bucket shops and "sell and switch" devices. There have been 693 swindlers convicted to date as a result of anti-fraud actions by the Commission. In addition, approximately 850 individuals and firms have been enjoined by Federal judges from violating the law, and at the close of the fiscal year, 351 additional individuals had been indicted for stock fraud and awaiting trial.

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The purposes of the Securities Exchange Act of 1934 are in general threefold. First, it is designed to correct unfair practices in the securities markets and to this end stock exchanges are placed under the jurisdiction of the Commission; hibited; and trading in securities is subject to the manipulation of the prices of securities are proCommission's regulations. Next, the Act aims to make available currently to the public sufficient information concerning the management financial condition of corporations whose securities are traded on national securities exchanges to enable the investor to act intelligently in making or retaining his investments and in exercising his rights as a security holder. For this purpose, a registration statement disclosing full information is required for each security listed on an exchange. This information is open to the public and must be kept up-to-date through the filing of annual reports. To guard against the misuse of inside information, the Act requires officers, directors, and large stockholders of listed corporations to report all transactions in securities of their respective companies. From Jan. 1, 1936, to June 30, 1941, officers, directors and large stockholders of listed corporations filed reports with the Commission covering 205,000 transactions, involving the purchase or sale of 126,000,000 shares of stock of their respective companies.

The Act also provides a system of regulation of over-the-counter brokers and dealers through voluntary associations under the supervision of the Commission. Individual brokers and dealers, however, are required to register with the Commission, and at the close of the fiscal year there were 6,065 so registered. The National Association of Securities Dealers, Inc., with around 3,000 members, is registered with the Commission as a national association of brokers and dealers.

The third purpose of the Act is to regulate the use of the national credit to finance trading in securities. This is accomplished by the regulation of margin requirements and is administered by the Board of Governors of the Federal Reserve System.

There were 2,350 issuers having securities registered on national securities exchanges as of June 30, 1941. There were 2,694 stock issues and 1,342 bond issues registered on national securities exchanges, while 1,077 stock issues and 252 bond issues were admitted to unlisted trading privileges. Sales of stocks and bonds on all registered national securities exchanges amounted to $7,200,969,000 during the year ended June 30, 1941.

The Public Utility Holding Company Act of 1935 is designed to eliminate abuses and to provide a greater degree of protection for investors and consumers in the financing and operation of public utility holding companies. Holding companies are required to register with the Commission and, subject to certain exceptions provided in the Act, registered companies cannot issue or sell securities or acquire securities or utility assets without the approval of the Commission." The Act calls for the simplification of the corporate structures of reistered utility holding companies and the confinement of their business to economically integrated units. The Commission has no power to regulate the rates of public utilities.

At the close of the 1941 fiscal year, there were 53 public utility holding company systems registered with the Commission, comprising 147 registered holding companies and including 1,457 individual holding, sub-holding and operating companies. The total consolidated assets of these companies approximated $15,000,000,000. Nearly $4,000,000,000 of utility securities have been issued since the Act became effective.

Chapter X of the National Bankruptcy Act makes it the duty of the Commission to act as a participant in reorganizations at the request or with the approval of the court in order to provide independent expert assistance to the courts. The Chapter also empowers the Commission to prepare advisory reports on reorganizations for the benefit of the courts and investors. In cases when the scheduled liabilites of the debtor corporation undergoing reorganization are over $3,000,000, the court automatically refers the proposed reorgani zation plan to the Commission for an advisory report. This report is an independent analysis designed to provide the court with a non-partisan survey of the plan, appraising its fairness and soundness and revealing any weaknesses Inequities.

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The Civil Aeronautics Authority was established under the Civil Aeronautics Act of 1938 (approved June 23, 1938). It was reorganized pursuant to Reorganization Plans No. III and No. IV, which became effective June 30, 1940. It is now within the framework of the Department of Commerce and has been separated into (1) the Civil Aeronautics Board and (2) Civil Aeronautics Administration (the Administrator of Civil Aeronautics and his staff). The Civil Aeronautics Authority is no longer an operating entity.

The Civil Aeronautics Board functions independently of the Department of Commerce, being governed by the five members constituting the Board. Although it is supplied by the Department of Commerce with certain so-called "housekeeping" services, it maintains its own staffs to handle legal, economic and safety matters.

Its duties and functions include the prescribing of safety standards, rules and regulations, and the suspension and revocation of various certificates, including pilots' and other airmen's certificates; the issuance of certificates of public convenience and necessity to United States air carriers and permits to foreign air carriers; receiving tariffs filed by air carriers; regulating rates for the carriage of persons and property; prescribing rates of compensation for the carriage of mail; regulating accounts, records and reports; passing upon mergers, federal loans to air carriers, methods of competition, and interlocking relationships. The Board in the administration of its functions is required to encourage and develop an airtransportation system properly adapted to the present and future needs of the foreign and domestic commerce of the United States, of the Postal Service, and of the national defense. The Board cooperates with the national defense agencies.

The Board has also taken over the functions of the former Air Safety Board, the offices of the members of which have been abolished. In performing these functions it makes rules on notification and report of accidents involving aircraft; investigates and reviews the investigation reports on such accidents and reports the facts, circumstances and probable causes; makes its reports and recommendations public in such manner as it deems to be in the public interest; investigates complaints and conducts special studies and investigations to reduce aircraft accidents and prevent their recurrence.

The Civil Aeronautics Administration functions under the direction of the Administrator of Civil Aeronautics, who is under the direction and supervision of the Secretary of Commerce. By authority of the Civil Aeronautics Act of 1938 and subsequent legislation, the Administrator encourages and fosters the development of civil aeronautics, and foreign and domestic air commerce of the United States.

The construction, improvement, and repair of airports necessary for national defense is vested in the Administrator under the current $100,000,000 airport program authorized by the Congress for the fiscal year ending June 30, 1942.

The Civilian Pilot Training Program, also under the Administrator, has given over 100,000 flight training courses, which produced by the end of 1941 some 65,000 new aircraft pilots and qualified several thousand pilots to act as flight instructors. The program has been an effective adjunct to the national defense effort and recently has supplied the Army and Navy with approximately one-third of the flying cadets initially enrolled each month. as well as hundreds of instructors.

The Administrator encourages the establishment of civil airways, landing areas, and other air navigation aids and facilities. He designates and estabilshes, operates and maintains air navigation facilities along civil airways and at landing areas. He also makes provision for the control and protection of air traffic moving in air commerce.

The Administrator is charged with undertaking or supervising technical developmental work in the field of aeronautics, and planning for the development of aeronautical facilities. This includes the testing of devices designed to increase safety in air navigation.

As the chief executive officer in the field of civil aeronautics, the Administrator is charged with the duty of administering safety regulation (excepting the prescribing of safety standards, rules and regulations, and the suspension and revocation of certificates after hearings. This includes the effectuation of safety standards, rules and regulations providing for the examination, inspection or rating of airmen, aircraft, aircraft engines, propellers, appliances, air carriers, air navigation facilities and air agencies, and the issuance of safety certificates. In this connection, he recommends to the Civil Aeronautics Board proposed standards, rules and regulations designed to promote air safety. In enforcing the rules and regulations of the Board, the Administrator makes emergency suspension of safety certificates and provides for the impositon and compromise of civil penalties for violations of such rules and regulations.

The Administrator further provides for the registration of aircraft, and the recordation of all conveyances affecting title to aircraft. He also provides for notice with respect to hazards to air

commerce.

The purpose of the Federal Communications Commission, as defined in the Communications Act of 1934, is to regulate interstate and foreign commerce in communications by wire and radio to make available to all the people in the United States a rapid, efficient, nation-wide and worldwide service with adequate facilities and reasonable charges. This program of regulation also includes provision for the national defense and for securing a more effective execution of communications policy by centralizing authority heretofore granted by law to several agencies.

Such supervision embraces allocation of radio frequencies; licensing of radio stations, and commercial and amateur radio operators; assignment of radio call letters; regulation of common carriers (point-to-point radio service; telephone, telegraph, and cable) in the matter of rates and tariffs, accounts, extension of facilities, operation and con

trol, and technical developments; promotion of radio and wire services, with particular reference to the utilization of radio in protecting life and property; and, particularly pertinent at the present time, the effective policing of the ether in connection with the national defense.

The Commission has jurisdiction over all radio services, including standard broadcast FM (frequency modulation), television, noncommercial educational international, relay, facsimile, developmental, marine (ship and coastal radiotelegraphy and radiotelephony), aviation (aircraft and airports), emergency (police, forestry, and special), experimental, Alaskan, and miscellaneous. Within the last year the Commission has authorized commercial operation of FM and television.

Program broadcast stations are not deemed common carriers under the Communications Act. Wire service which is intrastate in character is not subject to Commission authority.

President Roosevelt issued an Executive order (Sept. 24, 1940) establishing a Defense Communications Board to determine, coordinate and prepare plans with respect to the relationship of radio, wire and cable communications to the national defense. The board has no power to censor radio

or other communications, or to take over any facilities. The Board is composed of the Chairman of the Federal Communications Commission, the Chief Signal Officer of the Army, the Director of Naval Communications, an Assistant Secretary of State and an Assistant Secretary of the Treasury.