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708 CHAPTER 23

NLRB v. JONES AND LAUGHLIN STEEL CORP. (1937)

ORIGINS OF THE CASE In 1936, the Jones and Laughlin Steel Corporation was charged with intimidating union organizers and firing several union members. The National Labor Relations Board (NLRB) found the company guilty of “unfair labor practices” and ordered it to rehire the workers with back pay.

THE RULING The Supreme Court ruled that Congress had the power to regulate labor rela- tions and confirmed the authority of the NLRB.

LEGAL REASONING In the 1935 National Labor Relations Act, or Wagner Act, Congress claimed that its authority to regulate labor relations came from the commerce clause of the Constitution. Jones and Laughlin Steel argued that its manufacturing business did not involve interstate commerce—it operated a plant and hired people locally.

The Court disagreed. Although production itself may occur within one state, it said, production is a part of the interstate “flow of commerce.” If labor unrest at a steel mill would create “burdens and obstructions” to inter- state commerce, then Congress has the power to prevent labor unrest at the steel mill.

The Court also explained that the act went “no further than to safeguard the right of employees to self-organization and to select representatives . . . for collective bargaining.” Departing from earlier decisions, the Court affirmed that these are “fundamental” rights.

“ Long ago we . . . said . . . that a single employee was helpless in dealing with an employer; that he was dependent . . . on his daily wage for the maintenance of himself and family; that, if the employer refused to pay him the wages that he thought fair, he was . . . unable to leave the employ and resist arbitrary and unfair treatment; that union was essential to give laborers opportu- nity to deal on an equality with their employer.’’

As a result, the Wagner Act was allowed to stand.

Chief Justice Charles Evans Hughes

SCHECHTER POULTRY CORP. v. UNITED STATES (1935)

The Court struck down the National Industrial Recover y Act, a key piece of New Deal legislation.

RELATED CASES

U.S. CONSTITUTION, ARTICLE 1, SECTION 8 (COMMERCE CLAUSE)

“The Congress shall have Power . . . To regulate Commerce with foreign Nations and among the sever- al States.”

NATIONAL LABOR RELATIONS ACT (1935) “The term ‘affecting commerce’ means . . . tending to lead to a labor dispute burdening or obstructing com- merce or the free flow of commerce.”

“It shall be an unfair labor practice for an employer . . . to interfere with, restrain, or coerce employees in the exercise of the rights [to organize unions].”

LEGISLATION

LEGAL SOURCES

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