The Compromise of Collective Bargaining
Faced by this intimidating array of union tactics and the more favorable legal and political climate for labor, employers revised their approach to unions in the 1930s and in the process profoundly reshaped labor relation practices in the hotel and restaurant industry. Small and large employers now formed employer associations whose primary goal was the establishment of formal industrywide collective bargaining. In addition to stabilizing the industry and reducing competition, they hoped to end once and for all the insidious union "whip-saw technique" whereby the union insisted on dealing with each employer separately, playing one against the other. They also sought an end to the system in which union workers unilaterally determined their wages and working conditions and then struck for employer compliance. In other words, rather than oppose unionization altogether, employers banded together to contain the power of unions through institutionalized collective bargaining.[62]
The union, on the other hand, desired the extension of its old system of unilaterally determined wage scales and enforcement of standards on a house-by-house basis. Before 1937, individual culinary locals met and voted on the conditions that would govern their craft. These wage scales and working rules were not discussed with the employer; they were arrived at by the mutual consent of the members of each separate local. The individual crafts then submitted their proposals to the LJEB for approval (if a LJEB existed). The board, on behalf of its member trades, presented the standards to individual employers. Employers agreeing to the union wage scales and working conditions earned the privilege of displaying a union house card. A single-page "Union Labor License Agreement," signed by both the union and the employer, bound the "union card employer" to hire only union "members in good standing dispatched from the office of each respective union" and to pay employees "not less than the rate of wages . . . adopted by the LJEB." It was "expressly understood" that the LJEB reserved "the right to alter or modify or change the said scales from time to time." Wages and conditions of employment, then, were determined by the union "on a unilateral non-bargaining basis" and could be changed overnight at the whim of the unions.[63]
In 1937, the employers banded together and began organizing to subvert the old system. At a mass meeting of the restaurateurs, called by
attorney David Rubenstein, they empowered the Golden Gate Restaurant Association (GGRA) to act as their negotiating body. The majority of small luncheonettes and cafeterias formed a separate but similarly inclined organization, the Dairy Lunch and Cafeteria Owners Association (DLCOA). Rubenstein, chosen to head both organizations, needled apathetic owners still outside the associations by constant warnings of the dire consequences of inaction. "They are picking us off one by one," he railed. "If you fail to attend [association meetings] and are squeezed to the wall like a soft tomato, blame none but yourself."[64]
For three years, neither the GGRA nor the DLCOA made headway in moving the LJEB toward industrywide collective bargaining.[65] Desperate, the restaurant employers turned for assistance to Almon Roth, president of the San Francisco Employer's Council. The council had solidified its reputation during the 1938 department store strike, helping the employers win a single master agreement on an open-shop basis.[66] When the culinary unions issued their 1941 wage cards, directing significant wage increases for the first time since the 1920s, Roth responded, "the terms and conditions set forth in the cards which you have presented . . . are not satisfactory." Sixty-seven of the larger downtown restaurants instituted a 25 percent wage cut and reverted to the six-day week, eight-hour day.[67]
In the end, after a two-month lock-out in the summer of 1941, the employers gained their primary objective, a signed master agreement, but at the cost of acceding to union wage demands and a closed-shop clause. The LJEB compromised by signing one standard five-year contract covering the sixty-seven downtown restaurants, the tea rooms, dairy lunches, and cafeterias "with the right each year to re-open the contract and strike on wages but not on working conditions." The house card system continued, but the agreements signed by employers no longer required them to abide by wage scales determined solely by the LJEB. At the insistence of the employers, bilateral bargaining had come to San Francisco's restaurant industry.[68]
Association bargaining on a bilateral basis was more easily achieved in the hotel than in the restaurant industry. The few large hotel owners could coordinate and agree much more readily than could an unwieldy group of some hundred small restaurant entrepreneurs, some renowned for their flamboyance and boundless egos. Hotel employers also had no prior history of union-dominated unilateral bargaining to overcome. The hotel owners established industrywide association bargaining in their first encounter with the unions in 1937. In a second round of negotiations in 1941, the Hotel Employers Association and the union deadlocked over the union proposal for a closed shop and preferential hiring through the union
hiring hall. The ensuing hotel strike, called on August 30, 1941, convinced hotel employers that the open-shop era was an irretrievable heirloom of history. When back-to-work orders were finally issued by the National War Labor Board in April 1942, after eight grueling months, the union had proven itself a formidable opponent.[69]
Thus, by the early 1940s, an accord was achieved in the San Francisco hotel and restaurant industry that opened a new era of surprising stability and cooperation.[70] Union power had been extended over a wider terrain, yet at the same time employers had modified and diluted that power by forging a new bilateral bargaining system. The next major strike was not to occur until the 1980s, when the carefully crafted system of the 1930s began unraveling.