Report regarding investigation directed to be made by the President in his Executive Order of November 27, 1933, approving the Code of Fair Competition for the motion picture industry (July 1934)

dustry has the right to make rules and regulations with respect to fair practices, it has the concurrent right to make rules and regulations in the nature of self-discipline within the industry for the mutual protection and benefit of all concerned by or under such rules and regulations. "Your Deputy respectfully submits the provisions of article V, division B, part 5, for consideration. In your Deputy's opinion, these provisions require the most careful supervision, with thorough investigation and frequent reports demanded by the Administrator concerning their operation. "On the general subject of abuses and payments of excessive compensation, your Deputy recommends thorough investigation with report made to the President respecting such subject. "(Your Deputy begs to comment that a fair method of determining compensation, where it is likely to run into large figures, especially with respect to production activities, would be employment at a minimum stipulated figure against a percentage of the receipts of the production with which such person is associated.)" The Administrator, on these provisions, reported to the President as follows: "I recommend that such provisions shall in no event apply to writers, authors, and dramatists, and that with respect to other employees embraced within such provisions that such provisions shall not become effective and shall be suspended from operation pending further report from the Administrator after investigation." On November 27, 1933, the President in his Executive order approving the Code of Fair Competition for the Motion Picture Industry made, among others, the following conditions of approval: " (4) Because the President believes that further investigation with respect to the problems of payment of excessive compensation to executives and other employees in this industry is required, the provisions of article V, division A, part 4, of this code are hereby suspended from operation and shall not become effective pending further report from the Administrator after investigation; and " (5) Because the President believes that writers, authors, and dramatists are engaged in purely creative work, the provisions of article V, division B, part 5, sections 1 (c), 2, 3, 4, and 6, of this code, shall not become effective with respect to such employees; and "(6) Because the President believes that further investigation is required with respect to problems generally affecting unfair competitive methods for the services of classes of employees of producers rendering services of an artistic, interpretative, technical, supervisory, or executive nature, the provisions of article V, division B, part 5, sections 1 (c), 2, 3, 4, and 6, of this code, are suspended from operation and shall not become effective pending further report from the Administrator, after investigation, as to whether such provisions should be indefinitely suspended, or modified, altered, or changed, or become effective." By the Administrator's order of December 6, 1933, he directed as follows: "Deputy Administrator Sol A. Rosenblatt is hereby designated as representative of the Administration upon the Code Authority of the Motion Picture Industry Code. "In connection with his duties thereon he is hereby directed to make investigation and report to the Administrator pursuant to the provisions of sections 4 and 6 of the Executive order signed by the President on November 27, 1933; such report to be made to the Administrator not later than 90 days from the effective date of the code." Thereafter, and by order of March 3, 1934, the Administrator directed that this report be made on or before July 7, 1934. INVESTIGATION MADE (a) Following December 6, 1933, I had innumerable conferences with representative groups in the production division of the industry regarding the subject matter of investigation. On January 20, 1934, I journeyed to California for more facts and enlightenment on the subject matter, as I believed that such material upon which proper conclusions could be based might be more properly secured by direct contact with the production executives and employees affected by the investigation employed in production, and their agents, at the center of motion picture production in California. At all times I received the fullest cooperation from each group concerned. Conferences were held with representative production executives and with representative actors, directors, writers, technicians and supervisors. Thereupon, a divergence in views regarding the practicability, enforceability and wisdom of the suspended provisions of the code was disclosed. (6) Respecting an investigation of salaries paid in the motion picture industry, I caused to be formulated the form of questionnaire, and memoranda attached hereto (exhibit 1). Copies thereof in duplicate were disseminated on or about January 15, 1934, to approximately 2,000 persons, firms, and corporations engaged in the industry. Thereafter, on or about February 21, 1934, a letter (exhibit 2) was forwarded to those firms from whom replies had not been received; and thereafter, on or about April 12, 1934, a further communication (exhibit 3) was directed to those who had not yet to that time replied. Hereafter, the results of such statistical survey will be more fully expounded.