12.1 Wages above the basic wage

During the Depression, the Court had left margins for skill virtually constant as money amounts, save for the operation of the 10 per cent cut. Cancellation of the cut in 1934 meant that most margins were restored to their pre-Depression levels. Since the basic wage had fallen along with prices, the net effect was to increase the relative level of margins. As the Depression receded, the Court moved gradually to an even more generous treatment of margins, and there is no evidence that it was restrained by the widening of relativities that had occurred almost fortuitously in the years 1929–34. The change in approach had two main aspects: (1) a willingness to increase margins due to a view that economic necessity had hitherto compelled the Court to keep them too low and that industries were now able to bear higher wages; and (2) a resumption of the practice of assessing margins on the basis of the work performed. These two sources of change were not entirely separate: in some cases both were at work. It will, nevertheless, be convenient to discuss them as distinct processes.

12.1.1 The move to higher margins

The Court's willingness to approve higher margins was due partly to a general relaxation of wage restraint and partly to a conviction that more highly skilled workers were underpaid. All of the judges, to varying degrees, invoked both reasons for granting increases.