The Entrance of the C&O Canal

The C&O Canal faced numerous organizational and financial turmoils, much like most other canal companies. The task of building such a phenomenon was monumental. The canal company faced problems such as securing and mobilizing adequate capital, assembling a workforce numbering in the thousands, providing for a large volume of workers, a terrifying amount of violence on the canal line, and later, governing a slew of contractors and controlling their quality of work.

In an attempt to reduce such organizational problems (and, in effect, creating new ones), the canal company hired independent contractors to complete large spans of the canal system, making the employee and employer mutually dependent upon one another and ensuring the canal company distanced itself from the burden of workers.

Early on, this mutual dependency was beneficial to the workers. The contractors during this period were usually men local to the construction area who were looking for an injection of cash. Although many of these men had experience in some areas of construction, few had a background in canal construction and even fewer had participated in contract work. During this time period, all classes of workers and employers typically worked together, broke bread together, and slept under the same roof.

During the panic of 1837, the separate classes of workers began to become more and more apparent, with the Irish and a small number of slaves performing the harshest, most physically demanding work.

Very quickly, contracting on the canal became “big business”, and instead of local men, men with ample working capital from other areas began to move in. Many of the C&O Canal’s contractors came directly from Ireland. Others were once skilled Irish laborers trying their hand at contracting, often returning to the laboring ranks after failure. Once one job was completed, the men would disperse in search of further work.

However, even as early as October 1828, the C&O Canal Company was accepting nonnative contractors. During this month, the company hired five contractors from New York, five from Pennsylvania, one from the city of Washington, and only 2 from Virginia. During the construction period, the company was also known to accept bids from contractors located in Canada.

These contractors’ employees were usually transient Irish immigrants, who did not stay employed with one contractor for very long. German was also a common nationality, albeit in much lower numbers than the Irish. While the Irish tended to be mobile, chasing work, German workers were more likely to settle in the area once work commenced.

Transient workers would often migrate in groups, following faction leaders, contractors they had formed a good relationship with, and occasionally a few allies. Canawlers with families would just as often travel alone, with only their immediate family to keep them company.

Before the 1840’s, these floating workers did not wander aimlessly looking for work. Canawlers had built an underground network of sorts, with workers spreading the word about working conditions, wages, and contractors. This hearsay allowed laborers to choose their destinations wisely.

The mobility of these workers can be seen as both a blessing and a curse. Laborers would use their nomadic tendencies as a bargaining chip to help them secure employment and once there, improve working conditions. If a contractor pushed a laborer too far, he simply would threaten to abandon his post. However, most workers needed their wages and understood that working conditions elsewhere were likely to be similar, or worse. More often than not, this was a tactic used sparingly.

Laborers were most often hired on a monthly basis, with wages set based on a set number of workdays (usually 24 or 26). The monthly wage would decrease for each day lost due to sickness, weather or lack of work. Day laborers were paid daily at what would appear to be a higher wage, but would not include room and board.

Occasionally, hands would be hired under a piece rate system, where the worker was paid based on the amount of work completed. This type of employment was resented by the majority of workers, and although advantageous to speedy, industrial workers, was not common. However, contractors were often paid based on this system, being paid a set amount per yard of excavation.

The canal company accepted bids from contractors on a per section basis, each section commonly being about a ½ mile in length. Contracts for these sections were highly competitive, with each section averaging over fifty bids. With its contractors, it was common practice for the canal company to accept the lowest possible bid. Alongside high competition, contractors were forced to estimate the absolute bare minimum, betting on luck to have enough working capital to complete their awarded section and turn a meager profit.

The canal company was aware that the bids were so low that the possibility of contractor failure was likely, but that risk was not on their shoulders -- instead, it lied on the back of the contractor. Failure to complete the awarded work was common as expenses too often overran the contractor’s bid and resources, forcing them to abandon work and flee, often leaving workers unpaid.

Further exacerbating the situation was that the canal company required the contractor to post bond, ensuring that the contractor and his men would not abandon work and would produce work up to quality standards. Although contractors were paid monthly by the company, a 20% retainer would be taken off the payment and held until the company deemed the work satisfactorily completed. Usually, the final payment was not made until two months after completion of work due to the canal company’s shaky financial situation. This allowed for little working capital for contractors to complete the contract.

Canal Engineers had the power to declare contracts abandoned if they felt work quality work was not completed or the work did not meet the contract. Many contractors complained that canal engineers were severely undervaluing completed work by hundreds of dollars, forcing many contractors into bankruptcy.

The Irish responded to abandoning contractors and non-payment of wages by destroying work for which they were not paid. The company countered this measure, by suspending operations in the area, firing violators, and replacing them with workers of any origin… except Ireland. In effect, workers began to be penalized simply for being Irish.

In an attempt to motivate contractors, in 1829 the canal company implemented a reward system. A silver cup, valued at $50 would be awarded to the contractor who completed the best lock, a $10 silver medal for the best culvert, and numerous less precious medals awarded for various other jobs.

But more often than not, contractors too often ended the contract with massive losses or were forced to abandon work, leaving jobs only half completed and their workers unpaid.

Contractor M. S. Wines was $3,000 dollars in debt with all of his property confined to Washington County, Maryland when he pleaded with the C&O to release all of his outstanding earnings to his creditors, wishing only for his liberty. Another contractor, W. W. Fenton, owing over forty men $19 a piece and being unable to pay for their labor, begged the canal company to pay his men “for the benefit of their families”.

In May 1829, a contractor assigned section 19 fled the line, leaving his workers in destitute condition, “sick, unpaid, and without medicine or provisions with no power to obtain any.” A contractor by the name of Thomas Walsh fled “poor, common laborers” each to whom he owed between $15 and $42.60. And yet another contractor, R. A. Clements was owed $270 by the canal when his workers demanded to be paid before his numerous creditors, for which the outstanding money would not even cover the bill.

The contractors suffered greatly, but the workers suffered the brunt of the blow.

Although there is one account of workers hiring an attorney to receive wages due, most hands, especially the Irish, took the law into their own hands. Contractors feared the viciousness of an unpaid, overworked, and intoxicated angry mob, and often, this fact hastened their disappearance.

In 1829, a contractor estimated his daily costs per worker to be 96.5 cents. Of that amount, 46.5 cents were allocated to wages and 30 cents to board, whiskey, and tools. Although laborers would forfeit wages when they were unable to work due to weather, the contractor’s board and whiskey cost continued. Workers were, however, held financially responsible for any lost or broken tools.

The following year, in 1830, C&O Canal contractor H.W. Campbell noted his employees, averaging the same rate across other contractors, were receiving $8 a month wages with much higher provisioning costs. Only two years later, wages had jumped to $10 to $14 dollars a month due to labor shortages.

In 1828, the average wages of a canal laborer without board were $10 to $12 a month. By 1833, those wages jumped to $15 to $17 a month, and to $1 - $1.25 a day without board in 1839.

For most contractors, board accounted for about 40% of the wage cost.

During November of 1830, Thomas Kavanagh & Co. lost half of a month of work due to rain. During this period, boarding costs quickly mounted. From this period on, the company forced workers to pay a half of their board on days lost.

After similar experiences, many contractors had similar ideals. During the winter of 1829-30, workers whose families lived on the canal line received only a cash wage, and were expected to pay for their own board and laundry.

Meanwhile, the canal company continued to fall further behind in its payments to contractors.

In the April through May period of 1834, the C&O Canal began paying its contractors in company scrip, which was currency backed up by the company’s assets. In this period alone, the company issued $128,705 in scrip payments. Not long after, the scrip was discounted by up to 33%. During the year of 1837, the canal company issued $436,513.30 in scrip payments.