Bibliography-I

It is largely because of the dual character of the American Gov ernment that the United States for many years lagged far behind other industrial societies in social legislation. As the trend towards mass production increased and mining and interstate in dustry flourished the states found themselves by no means the master of their economic destinies. Legislatures hesitated to pass regulatory statutes when confronted by the possibility that many of their manufacturers producing goods for interstate mar kets, would move into other states. Moreover states which had adopted advanced labour standards were powerless to preserve the local market for the manufacturer whose labour costs were in creased by reason thereof, for under the Constitution a state may levy no impost upon goods shipped from a sister state regardless of how relatively backward its labour statutes may be. Then, states, passing labour laws in the face of these hazards, encoun tered further obstacles. As an aftermath of the Civil War, the states had been forbidden by a constitutional amendment to de prive persons of life, liberty, or property without "due process of law." By the end of the 19th century, the courts tended to iden tify "due process" with liberty of contract so that with increasing frequency they inclined to find state legislation regulating em ployment in conflict with the fundamental law of the land.

Public opinion with respect to these matters, however, was completely changed by the industrial depression, beginning in America with the collapse of the stock market in 1929, and rap idly becoming so aggravated that within three years it was esti mated that more than 12,000,000 wage earners were unemployed. This resulted in widespread agitation for legislation establishing maximum hours, minimum wages, and social insurance. Since unemployment was nationwide and since the states had failed to cope with the problem this agitation had its focal point in the Federal Government. In the early part of the 193o's the axis of labour legislation shifted from the states to the central govern ment.

Hours and Wages.

The gravity of the unemployment prob lem had attracted the attention of Congress increasingly from the years 1929-1933. In that latter year the Senate passed a bill im posing a thirty hour week upon American industry. That would have meant a drastic change from the normal working week which at that period was approximately 44 hours. Before the bill was acted upon by the House of Representatives, however, there was introduced in Congress one of the most comprehensive and elabo rately executed pieces of legislation in American economic his tory. This bill, known as the National Industrial Recovery Act, gave the President authority to promulgate codes of fair competi tion for industries, for the purpose of achieving economic recov ery. The bill was passed as emergency legislation and limited to two years. Although by its terms its operation was confined to industries engaged in or affecting interstate commerce, the ad ministrative body created under its terms popularly known as the NRA, construed the commerce clause in a broad sense which brought within the ambit of the code-making power virtually every industry in the country. Since the volume of interstate

commerce depends in part upon the purchasing power in the sev eral states, which in turn fluctuates with the volume of employ ment and the local wage level, the NRA took the view that the conduct of even retail industries or small factories producing goods for intrastate consumption, bore a direct relationship to interstate commerce. During the fall of 1933 and the spring of 1934 nearly every type of industry was covered by a code of fair competition, promulgated by the NRA.

From an employment standpoint the most important features of these codes were the child labour, minimum wage, and maxi mum hours provisions. These varied with the particular code but in general the normal code limited the hours of labour each week to forty. Another important feature, a provision common to all codes and known as Section 7 (a), will be considered separately.

Just as the two year period was almost over and Congress was considering legislation extending the life of the Act and the codes promulgated thereunder, a decision was handed down by the United States Supreme Court in the case of Schechter Poultry Corp. v. United States. In this case the Supreme Court held that the code-making section of the act was invalid as it was so vaguely worded that it amounted to an improper delegation of legislative authority by Congress to the executive branch of the government. The court also added that a code, when applied, as in the case at bar, to a firm which sold no goods outside the state in which it did business, was also unconstitutional as an attempt to deal with purely intrastate transactions. The decision with respect to the first point was so sweeping that all the codes were suspended, even those applying to industries doing an interstate business.

Congress was still in session when this opinion was handed down. Proponents of further Federal legislation, emphasizing the fact that the court had been silent with respect to industries pro ducing goods for interstate sale or shipment, argued that the em ployer-employee relationship in such industries was not beyond the pale of Federal jurisdiction. This view prevailed to some ex tent for Congress immediately passed legislation applying the code principle to the bituminous coal industry. Meanwhile movements were started for reviving the thirty hour bill and for passage of another bill which would have exacted code compliance from all employers contracting with the Government, supplying goods to Government contractors, or receiving loans and grants. Also be fore Congress was a resolution calling for the submission to the states of a constitutional amendment granting legislative control over all industrial employment. The session was adjourned late in the summer of 1935 without final action on any of these meas ures.