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Beneficiary Features of American Trade Unions by James B. Kennedy

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No factor has been of more consequence in determining the development
and stability of the relief systems than the character of their
administration. The problems that confront the unions are both
legislative and administrative, but the administrative organs must not
only execute the rules already in force, but must furnish data upon
which additional rules can be based.

When the early voluntary insurance associations were formed under the
auspices of the national unions, their management was usually confided
to a separate set of officials, and the funds of the association were
kept distinct from those of the unions with which they were connected.
In some cases the officers of the unions, for purposes of economy, acted
also as officers of the association. The Iron Molders' Beneficial
Association was thus formed as a separate institution to furnish a
voluntary death and disability benefit to any journeyman molder in good
standing in any local union under the jurisdiction of the national

[Footnote 210: Iron Molders' Journal, Vol. 7, March, 1871.]

The administration of the beneficiary systems, in all but two of the
unions, is now carried on by the officers who manage the general affairs
of the union. The Brotherhood of Locomotive Engineers and the National
Association of Letter Carriers each maintains a mutual benefit
department administered by separate officers. The official staff of the
Engineers' Insurance Association consists of a president, a
vice-president, a secretary-treasurer and five trustees; while that of
the Letter Carriers consists of the president of the National
Association, a board of trustees, a chief collector and a depositary.
In those unions in which the administration of the beneficiary system is
in the hands of the officials of the union the officials in charge of
the administration of the benefits are usually two, variously known as a
grand chief, grand master or president and a secretary-treasurer. In a
few unions the offices of treasurer and secretary are separated. In the
Cigar Makers the president also performs the duty of secretary. In the
Tailors the general secretary has sole charge of the benefits. In the
Iron Molders' Union the "financier" has charge of the administration of
the sick benefits.

The secretary-treasurer in the majority of the unions is the chief
official concerned in administering the benefits. Such is the case in
the Typographical Union, the Brotherhood of Painters, the United
Association of Plumbers, the Boot and Shoe Workers' Union, the Tobacco
Workers' Union, the Brotherhood of Leather Workers on Horse Goods, and
the Barbers' International Union.[211] In the Iron Molders' Union, the
Brotherhood of Carpenters, the Wood Workers' Union, the Glass Bottle
Blowers' Association, the United Garment Workers' Union, and the Granite
Cutters' Union these duties are divided between the general secretary
and the general treasurer.

[Footnote 211: Typographical Union, Constitution, 1904 (Indianapolis,
n.d.), p. 26; Plumbers' Constitution, 1904 (Chicago, n.d.), pp. 19-21;
Painters' Constitution, 1904 (La Fayette, n.d.), secs. 230-241; Boot and
Shoe Workers' Constitution, 1904 (Boston, n.d.), sec. 7; Tobacco
Workers' Constitution, 1900, third edition, 1905 (Louisville, n.d.), pp.
10-15; Leather Workers on Horse Goods, Constitution, 1904 (Kansas City,
n.d.), p. 7; Barbers' Constitution, 1905 (Indianapolis, n.d.), pp.

Ordinarily no particular part of the funds of the union is devoted to
the payment of beneficiary claims. The unions paying insurance, however,
are exceptional in this respect. In such cases the funds of the
insurance departments are separate from the general funds of the
brotherhoods, and the dues for maintaining the insurance departments are
levied as assessments distinct from the general levies. Nearly all the
grand lodges have made provision in their constitutions against
encroachments upon the beneficiary funds by the grand officers for the
benefit of other departments. The Trainmen and the Switchmen provide
that the beneficiary fund shall be used exclusively in paying death and
disability claims.[212] The Telegraphers provide that no part of the
mortuary fund shall be paid out, loaned or diverted for any purpose
except for the payment of approved death claims.[213] The Firemen pay
out of their beneficiary fund "all expenses for the proper conducting of
the beneficiary departments."[214] The position of the Conductors on
this point is not so explicit. The Order, however, holds in reserve a
fund of $300,000, from which the grand officers may draw, in case the
assessments levied for beneficiary purposes are insufficient to pay
legal claims and the surplus in the beneficiary fund is not sufficient
to cover the deficit.[215] The Engineers and the Maintenance-of-Way
Employees have no specific regulation of this kind; but the implication
is that similar protection is furnished their funds. The Letter Carriers
provide that the beneficiary fund shall be used exclusively for paying
insurance claims.

[Footnote 212: Constitution of the Railroad Trainmen, 1903 (Cleveland,
1903), sec. 58; Constitution of the Switchmen's Union of North America.
1903 (Buffalo, n.d.), sec. 57.]

[Footnote 213: Constitution, 1903 (St. Louis, n.d.), Article 23, p.

[Footnote 214: Constitution, amended, 1902 (Peoria, n.d.), sec. 52.]

[Footnote 215: Constitution, 1903 (Cedar Rapids, n.d.), Article 27, p.

Only a few of the unions paying benefits as distinguished from insurance
make any such provisions. The Boot and Shoe Workers provide that the
"sick and death benefit fund shall not be drawn upon for any purpose
except for payment of sick and death benefits;" the Painters, that "no
money received for a specific purpose shall be otherwise used;" and the
Tobacco Workers, that "none of the funds shall be transferable one to
another."[216] The Cigar Makers and the unions which follow its methods
go quite to the other extreme.[217] All the moneys of the union are
kept in a single fund and are drawn upon for the payment of benefits,
organizing expenses, or strike pay, as need requires. In the great
majority of unions, however, a nominal allocation of funds is practised.
Thus, the Typographical Union in 1906 apportioned its monthly dues as
follows: five cents to the general fund; five cents to the special
defense fund; seven and one half cents to the defense fund; seven and
one half cents to the burial fund; and ten cents to the endowment fund
of the Union Printers' Home. Similarly, the Iron Molders, the Boot and
Shoe Workers, Painters, Pattern Makers, Barbers and many others
apportion their dues in fixed ratios to specific objects. But such
apportionments are mere book-keeping devices. None of these unions
hesitate in an emergency to transfer money from one fund to another. The
Iron Molders and the Printers, for example, give their executive board
or council power to transfer money from one fund to another whenever
occasion demands.[218] In the other unions there is an implied power. In
1899 the Executive Board of the Iron Molders transferred $10,000 from
the surplus in the out-of-work fund to other funds, as follows: $3000 to
the strike fund; $5000 to the expense fund, and $2000 to the monthly
fund.[219] Similarly, the Typographical Union, from 1897 to 1902,
transferred $24,174.64 from the burial fund to the general fund.[220]
Although the Brotherhood of Carpenters do not make provision for the
transfer of money from one fund to another, it has been found necessary
to borrow from one fund in order to meet claims on another. In 1896 the
Executive Board borrowed seven thousand dollars from the "protective
fund" and twelve thousand from the "organization fund" with which to
pay benefit claims.[221]

[Footnote 216: Constitution of the Boot and Shoe Workers' Union, 1904
(Lynn, 1904), p. 25; Constitution of the Brotherhood of Painters,
Decorators and Paperhangers of America, 1906 (La Fayette, n.d.), p. 39;
Constitution of the Tobacco Workers' Union, 1900, third edition, 1905
(Louisville, n.d.), p. 18.]

[Footnote 217: The following are the more important unions making no
allocation of their funds: Cigar Makers, Typographia, Piano and Organ
Workers, and Plumbers.]

[Footnote 218: Constitution of the Iron Molders' Union of North
America, 1902 (Cincinnati, n. d.), p. 20; Constitution of the
International Typographical Union of North America, 1904 (Indianapolis,
1904) p. 10.]

[Footnote 219: Proceedings of the Twenty-second Session, Toronto, 1902,
p. 646 (Supplement to Iron Molders' Journal, September, 1902).]

[Footnote 220: Proceedings of the Forty-sixth Session, Milwaukee, 1900,
pp. 51, 99 (Supplement to Typographical Journal, September, 1900).]

[Footnote 221: The Carpenter, Vol. 16, October, 1896.]

Efficient financial administration requires in the case of certain
benefits an apportionment of revenue between the national union and its
subordinate unions. The funds for the payment of death and disability
benefits or of old age pensions can be held at national headquarters,
since the administration of such benefits can be centralized and
immediate payment is not essential. In the railway unions and in the
great number of unions, such as the Brotherhood of Carpenters and the
Typographical Union, which have developed only death benefits, the dues
for beneficiary purposes are collected by the local unions and paid over
to the national treasury. In those national unions which have introduced
sick, out-of-work, or travelling benefits, national funds are ordinarily
held by the local unions, for the reason that it is desirable that
payment of claims should be made immediately. The unions which pay such
benefits are divisible into two classes according to the extent to which
they have entrusted the funds of the national union to the local unions.
The Cigar Makers, the Typographia, the Piano and Organ Workers and the
Plumbers intrust to the local unions all the funds of the national
organization. A more numerous class of unions apportion the dues between
the local unions and the national organization. The Iron Molders, for
example, collect twenty-five cents per week from every member. This
amount is applied as follows: ten cents per week per member is
transferred to the International treasurer, of which sixteen per cent.
is placed to the credit of the death and disability fund, twenty-six per
cent. to the monthly fund, and fifty-eight per cent. to the strike fund;
eight cents per week per member is held by the local unions as a credit
to the benefit fund out of which are paid sick and out-of-work benefits;
and the remainder, seven cents per member, is held by the local unions
as a fund for local expenditures.

The adjudication of claims is naturally the most important
administrative task connected with a system of benefits. In all cases
the national officials rely upon the local unions and their officers for
a certain amount of cooeperation and aid in preventing fraud, but the
amount of this dependence varies with the character of the benefit. In
death and disability benefits the national union can prevent fraud
almost without any cooeperation on the part of the local unions. A
certificate of death or disability, properly signed, is in the great
majority of cases an indisputable evidence of the fact it purports to
attest. A union may in like manner administer an old age pension
directly from its head office. But in the case of sick, travelling and
out-of-work benefits, the local unions become an essential part of the
administrative machinery of the national union. No national union
attempts to determine whether a member of a local union is entitled to
the out-of-work benefit except through the local union. The
administrative systems fall thus into two great classes according as the
benefit administered can be guarded against fraud by means of
certificates and sworn statements, or according as it must be
administered partly by persons in contact with the claimant. In both
cases the national officers administer the benefits; but in the one they
act directly and the mediation of the local union is formal and
dispensable, while in the other the aim of national administration is to
supervise and control the local administration.

The administration of the death benefit or of a system of insurance
against death presents relatively few difficult problems. The local
union reports the death to the national officials and certifies to the
good standing of the deceased member in his local union. If the reports
of national and local unions correspond and the deceased member is clear
on the records of both local and national unions, the claim is approved
by the national officers and payment is made to the designated
beneficiary, or the legal heirs of the deceased. The report of the
subordinate union to the national union, covering the case in point,
contains a certificate validating the claim, sworn to before a notary
public or commissioner by the president and the financial secretary,
together with all documents upon which the local authorities based their
decision or prayer for the payment of the claim. Upon receipt of an
application for a claim the general secretary-treasurer, the general
president, or both, examine it and, if satisfied as to its validity,
order immediate payment; if the claim is questionable it is referred to
the general executive board for final adjustment.[222]

[Footnote 222: Iron Molders' Constitution, 1902 (Cincinnati, 1902), p.
41; Cigar Makers' Constitution, 1896, fourteenth edition (Chicago,
n.d.), sec. 151; Painters' Constitution, 1906 (La Fayette, n.d.), sec.

The adjudication of disability claims is more difficult than that of
death claims. Of the unions that pay disability insurance or benefits
the Locomotive Engineers, the Railway Conductors, the Locomotive
Firemen, the Railroad Trainmen, the Switchmen, the Maintenance-of-Way
Employees, the Iron Molders, the Brotherhood of Carpenters, the
Painters, and the Glass Workers specify the disabilities that constitute
"total or permanent disability," while the Wood-Workers and Metal
Workers define disability simply by the resultant disqualification for
"following the trade,"[223] In the latter group of unions the
administrative officers have large discretionary power. The lack of more
specific rules in such cases causes unsatisfactory administration and
this in turn gives rise to general complaint.[224]

[Footnote 223: Iron Molders' Constitution, 1902 (Cincinnati, 1902), p.
40; Carpenters' Constitution, 1905 (Milwaukee, n.d.), p. 19; Painters'
Constitution, 1904 (La Fayette, n.d.), p. 29; Glass Workers'
Constitution, 1903 (n.p., n.d.)5 p. 11; Wood Workers' Constitution, 1905
(Chicago, n.d.), sec. 137; Metal Workers' Constitution, 1903 (Joliet,
n.d.), sec. 115.]

[Footnote 224: Proceedings of the Nineteenth Session of the Iron
Molders' Union of North America, 1890, Report of President (Cincinnati,
n.d.); Proceedings of the Seventh General Convention of the United
Brotherhood of Carpenters and Joiners of America, 1892, Report of the
President (Philadelphia, 1892).]

All claims for disability benefits are filed with the local officers of
the disabled members' union for their examination and approval or
rejection. In case of approval the claims are forwarded to the central
office of the national union with all necessary papers concerning its
validity. If the claim is approved, payment is made through the local
union to the legal claimants.[225] The majority of the unions paying
disability benefits, as a precautionary measure specify the time within
which claims for disability must be filed. The Conductors and the
Carpenters require claims to be filed within one year from date of
disability,[226] the Firemen and the Switchmen, within six months,[227]
and the Trainmen "promptly" after injury;[228] while the Engineers and
the Maintenance-of-Way Employees fix no specific time for filing claims.
The Carpenters and the Painters require that notice of a claim for
disability must be given to the general secretary-treasurer within sixty
days after disability occurs.

[Footnote 225: Constitution of the Iron Molders' Union of North America
1902 (Cincinnati, 1902), p. 41; Constitution of the United Brotherhood
of Carpenters and Joiners of America, 1905 (Milwaukee, n.d.), secs.
109-110; Constitution of the Brotherhood of Painters, Decorators and
Paperhangers of America, 1906 (La Fayette, n.d.), secs. 84-87.]

[Footnote 226: Constitution of the Railway Conductors of America, 1903
(Cedar Rapids, n.d.), p. 82; Constitution of the United Brotherhood of
Carpenters and Joiners, 1905 (Milwaukee, n.d.), p. 19.]

[Footnote 227: Constitution of the Brotherhood of Locomotive Firemen,
1905 (Indianapolis, n.d.), p. 30; Constitution of the Switchmen's Union
of North America, 1903 (Buffalo, n.d.), p. 20.]

[Footnote 228: Constitution of the Brotherhood of Railroad Trainmen,
1903 (Cleveland, 1903), p. 35.]

The disability claim must be accompanied, under the rules of practically
all the unions, by the sworn certificates of the attending
physicians.[229] The Firemen provide that the national officials may,
when they consider it necessary, appoint a physician to pass upon the
validity of a claim; the Maintenance-of-Way Employees require
subordinate lodges to appoint a special committee to report on the
nature and cause of the disability. The Engineers exercise special care
in passing upon a claim for loss of sight. In such cases they require a
certificate signed by two experienced oculists; and in case the eyes
have not been removed the claim remains on file for one year, when
additional certificates from two experienced oculists, certifying to
total or permanent blindness, must be furnished.[230]

[Footnote 229: Constitution of the Brotherhood of Railroad Trainmen,
1903 (Cleveland, 1903), p. 35; Constitution of the Switchmen's Union of
North America, 1903 (Buffalo, n.d.), p. 16; Constitution of the United
Brotherhood of Carpenters and Joiners, 1905 (Milwaukee, n.d.), p. 19;
Constitution of the Brotherhood of Painters, Decorators and Paperhangers
of America, 1906 (La Fayette, n.d.), p. 20.]

[Footnote 230: Constitution of the Brotherhood of Locomotive Firemen,
1905 (Indianapolis, n.d.), p. 34; Constitution of the Maintenance-of-Way
Employees, 1903 (St. Louis, n.d.), p. 13; Constitution of the Grand
International Brotherhood of Locomotive Engineers, 1904 (Cleveland,
1904), p. 85.]

A member whose claim for a death or disability benefit has been rejected
may appeal from the decision of the official authorized to pass upon
claims. The provisions of the Trainmen are typical. Every claim rejected
by the secretary-treasurer is referred to the Beneficiary Board,
consisting of the grand master, the assistant grand master and the
secretary-treasurer. If rejected also by the Board the claimant may
appeal to the Grand Lodge "at its next succeeding session, but not
afterward." The appellant must give a written notice to the grand
secretary-treasurer of his intention to appeal.[231]

[Footnote 231: Constitution of the Railroad Trainmen, 1903 (Cleveland,
1903), p. 39.]

The unions paying the sick benefit fall into two classes according as
they administer the benefit directly from the offices of the national
union with the aid of the local union or as they intrust the
administration of the benefit to the local union and leave to the
national officers only a general supervision. The Boot and Shoe Workers,
the Barbers and the Tobacco Workers are in the former class, while in
the latter are the Cigar Makers, Iron Molders, Typographia, Plumbers,
Leather Workers on Horse Goods and the Garment Workers.

The chief means relied upon to guard against fraud are the certificate
of the attending physician and the report of a visiting committee of the
local union. Some of the unions require both the certificate and the
report; the larger part, however, rely on the report of the visiting
committee, although local unions are permitted to require that a
physician's certificate shall be furnished. The duties of the visiting
committee are set forth with great elaboration in all the constitutions.
Thus, the Boot and Shoe Workers require that the claim shall be
investigated by "three Union members of good repute not related to the
sick member, each acting independently of the others and reporting
individually to the local executive board." The Plumbers and Cigar
Makers require that every sick member shall be visited at least once in
each week and that no two members of the committee shall visit him at
the same time.

Notwithstanding these precautions it has not been possible entirely to
prevent the payment of fraudulent claims for sick benefits. The visiting
committees of the local unions are frequently neglectful or careless in
exercising their supervisory functions, and occasionally knowingly
sanction the payment of unwarranted claims. Where the unions do not have
an out-of-work benefit, there is always the chance that unemployed
members will claim the sick benefit and that the local unions, aware
that the money for the payment of the claim comes from the national
union, will not scrutinize with any care the severity of the illness.

Reserving to the national officials the right to pass finally upon
sick-benefit claims is not effective as a precaution against such
frauds. The national officials cannot inform themselves as to the
honesty of the physician who signs the certificate nor as to the good
faith with which the visiting committee has performed its duties. On the
whole, the better policy seems to be to place the responsibility of
passing upon individual claims directly upon the local union, and to
reserve to the national officials an oversight of the administration of
the local unions.

In several of the unions no effective measures appear to have been taken
to keep the local unions up to their duties, but in others a close
scrutiny is maintained. The system in use by the Iron Molders is
probably the most effective of those used by the unions which do not pay
a money out-of-work benefit and in which consequently the need for
supervision is greatest. Every member of the union is catalogued on a
card. When he is reported as having received a benefit payment from any
local union, this fact is entered on his card. Members removing from one
local union to another and drawing more sick benefits than they are
allowed by the rules are thus detected and forced to make restitution.
The "financier" of the union also notes the sick rate in each local
union. When the amount of sickness in any locality appears to be
excessive, he employs for a limited time a reputable physician, who must
sign all claims for sick relief. The result usually is the discovery of
laxity in the local administration and the necessary corrective measures
are applied.[232] The Cigar Makers have a staff of travelling auditors
who from time to time inspect the accounts of local unions and
scrutinize the administration of the benefits.

[Footnote 232: Proceedings of the Twenty-second Convention, 1902, in
Supplement to Iron Molders' Journal, September, 1902; Proceedings of the
Twenty-third Convention, in Supplement to Iron Molders' Journal,
September, 1907.]

The administration of out-of-work relief is similar to that of sick
benefits in that the national union must of necessity rely upon the
local union. The requirement of registration from day to day is the
chief administrative check upon the payment of the benefit to members
not entitled thereto.

The more complete the system of benefits the less is the difficulty in
preventing the payment of fraudulent claims. A union such as the Cigar
Makers or the Typographia has a comparatively small problem in
administration as compared with that of a union like the Iron Molders.
Since the Iron Molders do not maintain an out-of-work benefit unemployed
members are tempted to try to secure sick benefits. Even in the Cigar
Makers the sick benefit and the out-of-work benefit are used as a form
of superannuation relief. The addition of a superannuation benefit would
lower the expense of maintaining the sick and out-of-work benefits.

The administration of trade-union benefits is subject to certain rules
imposed by the statutes of the various states. All the commonwealths of
the United States regulate by law the conduct of insurance business. In
this regulation, distinction has necessarily been made between regular
insurance companies and that class of organizations known as fraternal
or beneficiary societies. The trade organizations described in this
monograph as maintaining insurance or benefit departments fall under the
latter class.

The unions paying insurance, as distinguished from benefits, have
conformed to certain requirements of these laws, either by incorporating
their insurance departments or by modifying the rules of the
organizations in harmony with special state regulations for fraternal
insurance companies.

Prior to 1894--from December, 1867, to 1894--the Brotherhood of
Locomotive Engineers had its headquarters in the state of New York. In
the latter year the State Superintendent of Insurance notified the
Brotherhood that incorporation of the insurance department was necessary
for the continuance of the business. In consequence thereof the central
office of the Brotherhood was transferred to Cleveland, Ohio, and on the
twenty-second of February, 1894, the insurance department was
incorporated under the laws of the state of Ohio as a separate
organization.[233] Similarly, the Conductors were forced to incorporate
by the pressure of the state laws. In December, 1885, the Order moved
its central office from Cedar Rapids to Chicago. In order to strengthen
its power and to broaden its influence, the Order, in 1886, applied for
a certificate of incorporation under the laws of the state of Illinois.
The Secretary of State refused the certificate on the ground that the
insurance regulations of the Order were not in accordance with the state
laws, and requested that these be changed and that the insurance
department be incorporated as a separate organization. The Secretary of
State was willing to incorporate the Order under the Act of 1872,
provided the Order eliminated from the object of organization the
clauses referring to the payment of benefits or indemnity; or he was
willing to issue a charter based on the Act of 1883 which provided that
only such powers could be taken as are specifically granted therein,
namely, "the furnishing of life indemnity or pecuniary benefits to
widows, orphans, heirs, relatives, and devisees of deceased members, or
accident or permanent disability indemnity to members."[234] In other
words, the Order could have been incorporated under the Act of 1872 to
do all business except insurance, while under the Act of 1883 it could
have been incorporated to maintain a system of insurance, but nothing
else. The only alternative was separate organization for the protective
and the benevolent departments. The Order was unwilling to separate the
two departments and consequently transferred its central office to Cedar
Rapids, Iowa. The Board of Directors, on July 12, 1887, ordered the
grand secretary to proceed with incorporation under the laws of the
state of Iowa.[235] The certificate of incorporation, however, was not
issued until the laws of the union were made to conform to the insurance
laws of the state. These changes were only unimportant ones, such as the
change of the name of the Insurance Department to "Mutual Benefit
Department," and in no way affected the intent of any laws of the Order.

[Footnote 233: Locomotive Engineers' Journal, Vol. 28, p. 360.]

[Footnote 234: Proceedings of the Nineteenth Convention of the Order of
Railway Conductors, New Orleans, 1887 (Cedar Rapids, n.d.), pp. 51-52,

[Footnote 235: Proceedings of the Nineteenth Convention of the Order of
Railway Conductors, New Orleans, 1887 (Cedar Rapids, n.d.), pp.

The other railway brotherhoods have conformed to the insurance laws of
the states in which they do business. The insurance department of the
Switchmen's Union is incorporated under the laws of the state of New
York. The Brotherhood of Locomotive Firemen does business in the state
of Illinois under a law enacted in 1893 whereby all beneficial fraternal
associations are declared to be corporations, the insurance features of
which are subject to state laws.[236] The Brotherhood of Railroad
Trainmen operates its insurance department under a license issued by the
insurance department of the state of Ohio under the Fraternal
Beneficiary Society Act.

[Footnote 236: Hurd, Revised Statutes of Illinois, 1901 (Chicago, 1901),
secs. 258-260, p. 1071.]

The National Association of Letter Carriers, at the time of organizing
the Benefit Association, on August 7, 1891, incorporated the Association
under the laws of the state of New Jersey. But less than one year later,
on February 26, 1892, the Association was reincorporated under the laws
of the state of Tennessee. This change was made, according to Collector
Dunn,[237] in order that both the National Association and the Mutual
Benefit Association might operate under a single charter.

[Footnote 237: Letter to the author, February 14, 1905.]

The unions that pay benefits as distinguished from insurance are less
subject to legal regulation. They do not issue beneficiary certificates
as do the railway unions, the Letter Carriers' Association, and the
large class of fraternal beneficiary societies, and hence are not deemed
to be maintaining insurance departments. With one exception, the
Brotherhood of Painters,[238] the unions of this group have neither
taken out charters of incorporation nor in any way obtained authority to
operate benefit departments within their respective states. These unions
cannot be said to operate their beneficiary systems irrespective of
state laws. In all the states the laws define the scope and functions of
such organizations.

[Footnote 238: Constitution, 1901 (La Fayette, n.d.), p. 1. Chartered
under the laws of the State of Indiana.]

The Brotherhood of Painters, in the incorporation of its organization,
has taken a step beyond the practices of unions of its type. On December
7, 1894, the Secretary of State of Indiana issued a certificate of
incorporation to the Brotherhood under the state law entitled "An act to
authorize the formation of voluntary associations;" and in order to
conform more strictly to the state laws the corporate name was changed,
in December, 1899, to the present name.[239] Incorporation, however, has
not proved satisfactory. For many years the Brotherhood maintained one
general fund from which local unions received assistance in time of
strikes, or in other cases of need. As a chartered institution the
funds were liable at legal action and all payments from them subject to
injunction. This state of affairs led the officials to urge complete
separation of protective and benevolent funds, thereby offering greater
protection to the membership. Consequently in 1904 the Brotherhood
adopted the recommendations of the national officials and apportioned
the national receipts into separate funds to be used only as specified.

[Footnote 239: Constitution of the Brotherhood of Painters, Decorators,
and Paperhangers of America, 1899 (La Fayette, n.d.), pp. 2-5.]

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