125.8573/9–449: Telegram
The Consul at Shanghai (McConaughy) to the Secretary of State
[Received September 4—11:04 a. m.]
3648. Following text of communication delivered September 2 to Alien Affairs Department, Shanghai Military Control Commission:
“On July 15, the undersigned, as deputy acting director of the USIS, branch of this office, was instructed by you to suspend forthwith activities of the USIS. This order was complied with. On July 20 we addressed to your office a petition protesting arbitrary closure of USIS and requesting reconsideration this decision. To date we have received no reply to above communication.
“On July 15, local employees of USIS were notified officially of suspension orders but were retained on payroll pending final decision from your office regarding our petition for reopening. It was made clear at that time that their services would have to be terminated in view of closure order of authorities unless order were modified. On August 18 we informed local employees of USIS their services would be terminated as of September 3, they would at that time receive their final pay, plus lump sum settlements of accrued leave and refund of retirement sayings. We also offered them termination bonus of 2, 4 or 6 weeks, depending on length of service. This offer was rejected by employees who, in turn, demanded minimum severance bonus equivalent to 8 months’ pay from which demand they have refused recede.
“After several fruitless attempts reach an agreement, dispute was submitted on August 27 by both parties to Shanghai General Labor Union for advice and counsel. We have been informed by Shanghai [Page 1289] General Labor Union we should receive notice from Alien Affairs Department as to time and place for hearings of this dispute.
“We have been informed by former local employees of USIS they will refuse recognize their dismissal as effective on date September 3. We have clearly informed employees of our position in this matter in two notices of September 1 and 2 respectively, copies of which attached.
[“]In communication of September 1, employees have informed us that notwithstanding dismissal they intend continue coming to office as usual after September 3. Since work of USIS has been completely suspended in accordance with your instructions and the various wind-up tasks have been completed, we can only construe this intention of former USIS employees as attempt to circumvent order of your Department.
“We are calling these matters to your attention merely to place sequence of events on record so you may be fully informed in case any incident should develop.”
Sent Department; repeated Nanking 1913, Canton 1078, Peiping 312.