Supreme Court decision
By: John Marshall Harlan
Date: January 27, 1908
Source: Harlan, John Marshall. Adair v. U.S. 208 U.S. 161 (1908). Available online at (accessed November 22, 2002).
About the Author: John Marshall Harlan (1833–1911) was born in Kentucky and pursued a career as a lawyer and politician. He served on the Supreme Court from 1877 until his death. Known as "the Great Dissenter," Harlan was famous for his dissenting opinions in such cases as Plessy v. Ferguson and Berea College v. Kentucky. Before being appointed Supreme Court justice, he was attorney general of Kentucky and the Republican gubernatorial candidate in Kentucky in 1871 and in 1875.
The Industrial Revolution of the mid-nineteenth century had a devastating impact on workers, in America and around the globe. Rapid mechanization and mass production destroyed the shop-based industry that had developed over several centuries. As a result, jobs for skilled workers were eliminated, connections between shop owner and worker were broken, and workers lost their bargaining power. By the late 1800s, most laborers worked over sixty hours a week, frequently putting in twelve-hour days, six days a week. In the steel industry, employees worked twelve hours a day, seven days a week. Every two weeks, steel workers would switch shifts, working a full twenty-four hours to transfer from one shift to the next, in what was called the "long turn."
Workers tried to respond to these conditions by organizing unions, but many barriers were in their way. One such barrier was the ethnic divisions among the workers themselves. Another was hostility from the government, which would often use military troops to break strikes. A third, and by far the most important, was opposition from industry owners. They generally obstructed unions in any way possible, firing workers who joined unions, using spies, and bringing in strikebreakers. One method was the "yellow-dog" contract, which stipulated that the worker signing the contract would not join a union and that the company could fire the worker for doing so. Such contracts were banned in 1898 by the U.S. government as a response to the bloody Pullman strike.Ten years later, the law was challenged in the Adair v. U.S. case.
In Adair v. U.S., William Adair, an agent for the Louisville & Nashville Railroad Company, was charged with discriminating against O.B. Coppage, a railroad employee whom he had fired in 1906 for being a member of a union. In its ruling, the Supreme Court struck down the law banning yellow-dog contracts, holding that it violated a worker's "liberty of contract." That doctrine held that, under the concept of individual liberty "protected by the Fourteenth Amendment," each worker had the right to enter into a contract freely, without interference from the federal government. However, this limited the ability of a state or the federal government to pass protective legislation for workers. In 1908, the same year as the Adair case, the Court allowed states to pass protective legislation for women, but that was justified by what the Court considered women's special condition.
The "liberty of contract" doctrine was finally phased out in the 1930s. By that time, the states and the federal government had been given more power to protect and help workers. Nevertheless, in 1908, the Court decision on Adair took a narrow view of the idea of commerce, holding that Congress' constitutional power to regulate commerce does not reach to labor regulations. Thus, even if the idea of liberty of contract did not apply, Congress probably would not have been able to pass legislation banning yellow-dog contracts, as it was outside its power in 1908. This narrow view limited Congress' power, and it was not changed until the 1940s. At that time, the Supreme Court took a broad view of commerce, holding that activities only had to have a substantial effect on interstate commerce for regulation to be allowed. Succeeding courts have largely continued this line of reasoning, rather than returning to the view of the commerce clause held at the time Adair was decided.
Primary Source: Adair v. U.S. [excerpt]
SYNOPSIS: In presenting the ruling of the Court, John Marshall Harlan first examines the congressional statute. He argues that outlawing "yellow-dog" contracts violates the Fifth Amendment's prohibition against denying one's liberty without due process of law. Harlan also argues that Congress does have the power to regulate interstate commerce, but that labor unions are not part of commerce. Holmes' dissent argues that unions and labor are closely enough connected with interstate commerce for Congress to pass this law.
Mr. Justice Harlan delivered the opinion of the court: .…
May Congress make it a criminal offense against the United States—as, by the 10th section of the act of 1898, it does—for an agent or officer of an interstate carrier, having full authority in the premises from the carrier, to discharge an employee from service simply because of his membership in a labor organization?
This question is admittedly one of importance, and has been examined with care and deliberation. And the court has reached a conclusion which, in its judgment, is consistent with both the words and spirit of the Constitution, and is sustained as well by sound reason.
The first inquiry is whether the part of the 10th section of the act of 1898 upon which the first count of the indictment was based is repugnant to the 5th Amendment of the Constitution, declaring that no person shall be deprived of liberty or property without due process of law. In our opinion that section, in the particular mentioned, is an invasion of the personal liberty, as well as of the right of property, guaranteed by that Amendment. Such liberty and right embrace the right to make contracts for the purchase of the labor of others, and equally the right to make contracts for the sale of one's own labor; each right, however, being subject to the fundamental condition that no contract, whatever its subject-matter, can be sustained which the law, upon reasonable grounds, forbids as inconsistent with the public interests, or as hurtful to the public order, or as detrimental to the common good… Without stopping to consider what would have been the rights of the railroad company under the 5th Amendment, had it been indicted under the act of Congress, it is sufficient in this case to say that, as agent of the railroad company, and, as such, responsible for the conduct of the business of one of its departments, it was the defendant Adair's right—and that right inhered in his personal liberty, and was also a right of property—to serve his employer as best he could, so long as he did nothing that was reasonably forbidden by law as injurious to the public interests. It was the right of the defendant to prescribe the terms upon which the services of Coppage would be accepted, and it was the right of Coppage to become or not, as he chose, an employee of the railroad company upon the terms offered to him.…
In Lochner v. New York … the court said: "The general right to make a contract in relation to his business is part of the liberty of the individual protected by the 14th Amendment of the Federal Constitution…"
While, as already suggested, the right of liberty and property guaranteed by the Constitution against deprivation without due process of law is subject to such reasonable restraints as the common good or the general welfare may require, it is not within the functions of government—at least, in the absence of contract between the parties—to compel any person, in the course of his business and against his will, to accept or retain the personal services of another, or to compel any person, against his will, to perform personal services for another. The right of a person to sell his labor upon such terms as he deems proper is, in its essence, the same as the right of the purchaser of labor to prescribe the conditions upon which he will accept such labor from the person offering to sell it. So the right of the employee to quit the service of the employer, for whatever reason, is the same as the right of the employer, for whatever reason, to dispense with the services of such employee. It was the legal right of the defendant, Adair,—however unwise such a course might have been,—to discharge Coppage because of his being a member of a labor organization, as it was the legal right of Coppage, if he saw fit to do so,—however unwise such a course on his part might have been,—to quit the service in which he was engaged, because the defendant employed some persons who were not members of a labor organization. In all such particulars the employer and the employee have equality of right, and any legislation that disturbs that equality is an arbitrary interference with the liberty of contract which no government can legally justify in a free land.…
But it is suggested that the authority to make it a crime for an agent or officer of an interstate carrier, having authority in the premises from his principal, to discharge an employee from service to such carrier, simply because of his membership in a labor organization, can be referred to the power of Congress to regulate interstate commerce, without regard to any question of personal liberty or right of property arising under the 5th Amendment. This suggestion can have no bearing in the present discussion unless the statute, in the particular just stated, is, within the meaning of the Constitution, a regulation of commerce among the states. If it be not, then clearly the government cannot invoke the commerce clause of the Constitution as sustaining the indictment against Adair.
Let us inquire what is commerce, the power to regulate which is given to Congress?
This question has been frequently propounded in this court, and the answer has been—and no more specific answer could well have been given—that commerce among the several states comprehends traffic, intercourse, trade, navigation, communication, the transit of persons, and the transmission of messages by telegraph,—indeed, every species of commercial intercourse among the several states,—but not that commerce "completely internal, which is carried on between man and man, in a state, or between different parts of the same state, and which does not extend to or affect other states." .…
… Manifestly, any rule prescribed for the conduct of interstate commerce, in order to be within the competency of Congress under its power to regulate commerce among the states, must have some real or substantial relation to or connection with the commerce regulated. But what possible legal or logical connection is there between an employee's membership in a labor organization and the carrying on of interstate commerce? Such relation to a labor organization cannot have, in itself and in the eye of the law, any bearing upon the commerce with which the employee is connected by his labor and services. Labor associations, we assume, are organized for the general purpose of improving or bettering the conditions and conserving the interests of its members as wage-earners,—an object entirely legitimate and to be commended rather than condemned. But surely those associations, as labor organizations, have nothing to do with interstate commerce, as such. One who engages in the service of an interstate carrier will, it must be assumed, faithfully perform his duty, whether he be a member or not a member of a labor organization. His fitness for the position in which he labors and his diligence in the discharge of his duties cannot, in law or sound reason, depend in any degree upon his being or not being a member of a labor organization. It cannot be assumed that his fitness is assured, or his diligence increased, by such membership, or that he is less fit or less diligent because of his not being a member of such an organization. It is the employee as a man, and not as a member of a labor organization, who labors in the service of an interstate carrier.…
It results, on the whole case, that the provision of the statute under which the defendant was convicted must be held to be repugnant to the 5th Amendment, and as not embraced by nor within the power of Congress to regulate interstate commerce, but, under the guise of regulating interstate commerce, and as applied to this case, it arbitrarily sanctions an illegal invasion of the personal liberty as well as the right of property of the defendant, Adair.
… The judgment must be reversed, with directions to set aside the verdict and judgment of conviction, sustain the demurrer to the indictment, and dismiss the case.
It is so ordered.…
Mr. Justice Holmes, dissenting:
I also think that the statute is constitutional, and, but for the decision of my brethren, I should have felt pretty clear about it.
As we all know, there are special labor unions of men engaged in the service of carriers. These unions exercise a direct influence upon the employment of labor in that business, upon the terms of such employment, and upon the business itself. Their very existence is directed specifically to the business, and their connection with it is, at least, as intimate and important as that of safety couplers, and, I should think, as the liability of master to servant,—matters which, it is admitted, Congress might regulate, so far as they concern commerce among the states. I suppose that it hardly would be denied that some of the relations of railroads with unions of railroad employees are closely enough connected with commerce to justify legislation by Congress. If so, legislation to prevent the exclusion of such unions from employment is sufficiently near. The ground on which this particular law is held bad is not so much that it deals with matters remote from commerce among the states, as that it interferes with the paramount individual rights secured by the 5th Amendment. The section is, in substance, a very limited interference with freedom of contract, no more. It does not require the carriers to employ anyone. It does not forbid them to refuse to employ anyone, for any reason they deem good, even where the notion of a choice of persons is a fiction and wholesale employment is necessary upon general principles that it might be proper to control. The section simply prohibits the more powerful party to exact certain undertakings, or to threaten dismissal or unjustly discriminate on certain grounds against those already employed. I hardly can suppose that the grounds on which a contract lawfully may be made to end are less open to regulation than other terms. So I turn to the general question whether the employment can be regulated at all. I confess that I think that the right to make contracts at will that has been derived from the work "liberty" in the Amendments has been stretched to its extreme by the decisions; but they agree that sometimes the right may be restrained. Where there is, or generally is believed to be, an important ground of public policy for restraint, the Constitution does not forbid it, whether this court agrees or disagrees with the policy pursued. It cannot be doubted that to prevent strikes, and, so far as possible, to foster its scheme of arbitration, might be deemed by Congress an important point of policy, and I think it impossible to say that Congress might not reasonably think that the provision in question would help a good deal to carry its policy along. But suppose the only effect really were to tend to bring about the complete unionizing of such railroad laborers as Congress can deal with, I think that object alone would justify the act. I quite agree that the question what and how much good labor unions do, is one on which intelligent people may differ; I think that laboring men sometimes attribute to them advantages, as many attribute to combinations of capital disadvantages, that really are due to economic conditions of a far wider and deeper kind; but I could not pronounce it unwarranted if Congress should decide that to foster a strong union was for the best interest, not only of the men, but of the railroads and the country at large.
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