During what Mark Twain called the Gilded Age at the end of the nineteenth century, American commerce grew exponentially and the American economy became the largest in the world. Wealthy industrialists organized their businesses to maximize efficiency and profits, contributing to an increase in buying power for all segments of American society and drawing millions of immigrants from around the world to the United States for opportunity. Workers, toiling long hours in dangerous conditions, sought to organize themselves, too, forming labor unions to bargain collectively for better wages and working conditions. The early attempts at labor solidarity found only very limited success as management blocked their efforts through strike-breaking and intimidation. Conflicting interests between labor and management led to confrontations and violence in several major industries in the intermittent recessions that occurred in the latter decades of the 1800s.
Some employers tried to prevent disruptions and strikes by requiring prospective employees to sign an agreement, called a yellow dog contract, not to join a union. In the 1898 Erdman Act, Congress made it illegal for an employer to fire a worker for being a member of a labor union, but owners of interstate railroads believed the law was an unconstitutional interference with their liberty of contract. Louis Adair, of the Louisville and Nashville Railroad Company, challenged the Erdman Act by firing a railroad worker who joined a union. In Adair v. United States (1908) the U.S. Supreme Court ruled in favor of the railroad, basing the decision on the Fifth Amendment’s due process clause. In the majority opinion in the case, Justice Harlan wrote, “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.” Justice Harlan explained that the Erdman Act violated the contract rights of employers engaged in interstate commerce, and was outside of Congress’s commerce power.
State governments in the early twentieth century also enacted laws regulating labor conditions and protecting the right of workers to join labor unions, but employers believed those laws interfered with their liberty of contract. In the Adair decision the Supreme Court invalidated a federal law designed to protect labor unions; would state laws meet the same fate? The central question was whether it was constitutional for a state to prohibit employers from banning their employees from joining a union.
In 1909 the Kansas legislature enacted a law prohibiting employers from requiring employees to sign anti-union contracts. T.B. Coppage, Superintendent of Frisco Lines, a railway company in Fort Scott, Kansas, imposed a yellow-dog contract on his employees in 1911. When one of Coppage’s employees refused to sign the new contract and declined to withdraw from the Switchmen’s Union, Coppage fired him. Coppage argued that liberty of contract fell under the Fourteenth Amendment’s substantive due process clause, and protected his right to hire workers under any conditions that both parties found acceptable, including the yellow dog contracts.
The state argued that the 1909 law was a constitutional exercise of the state’s policy to protect the privileges and immunities of citizens by preventing a coercive practice of employers who sought to deprive them of the benefits of union membership.
The U.S. Supreme Court majority held that the Kansas law prohibiting yellow-dog contracts threatened employers’ rights of liberty and property, and was unconstitutional because it violated the Fourteenth Amendment’s due process clause. Workers had the right to join labor unions, but had no inherent right to do so and still remain employed by a business operator who was unwilling to employ union members. Justice Mahlon Pitney delivered the opinion of the Court in the 6-3 decision. He wrote,
[T]he Fourteenth Amendment, in declaring that a state shall not “deprive any person of life, liberty or property without due process of law,” gives to each of these an equal sanction; it recognizes “liberty” and “property” as co-existent human rights.
The rights of personal liberty and private property supported a liberty of contract requiring that workers and employers have the right to work out their own conditions of contracts of employment. The state could not use its police power to equalize the bargaining power of unions by limiting the liberty of contract of employers.
In dissent, Justices Day, Hughes, and Holmes believed that the Kansas law was a justifiable regulation to address the difference in bargaining power between employers and employees, because it prevented coercive practices by management. As Justice Day wrote, the law “put limitations upon the sacrifice of rights which one man may exact from another as a condition of employment.”
Taken together, the Adair and Coppage decisions meant that the Constitution’s protection of liberty and property allowed employers to require their workers to refrain from union membership, and neither federal nor state laws protecting the right of workers to join a union were constitutional. This interpretation of the law stood until the New Deal Court reversed these precedents.
During the New Deal era, new state and federal legislation recognized the right of laborers to join unions, and the 1935 National Labor Relations Act essentially outlawed yellow dog contracts. Frustrated with what he saw as the Supreme Court’s interference in several essential economic regulations to counter the Great Depression, President Franklin Roosevelt had proposed the appointment of additional justices to the Court, expecting that this “court-packing plan” would give him a pro-New Deal majority. Within a week of Roosevelt’s proposal in 1937, the Court heard oral argument in National Labor Relations Board v. Jones and Laughlin Steel Corp. This time Justice Hughes was in the majority, writing the opinion in the Court’s 5-4 ruling that the NLRB’s protection of the right of workers to join unions was constitutional. Justice Holmes rejected a liberty-of-contract approach and explained that the law’s protection of labor unions was a legitimate use of the Commerce Clause (Article 1, Section 8, Clause 3) because it could prevent crippling strikes that would interfere with interstate commerce.
The Coppage decision was part of the “Lochner Era” in which the Court generally protected property rights and curtailed state and federal economic regulations. The Court allowed the free market to decide, and management often hired employees with anti-union contracts to prevent labor disruptions. During the New Deal, the Court reversed this line of precedent in 1937 and allowed the different levels of government to intervene in the employer-employee relationship to strengthen the interests of organized labor unions and individual workers. During both eras, the Court struggled with defining the boundaries of constitutional regulatory power of the government in private enterprise.
Coppage v. Kansas (1915) Supreme Court decision: https://supreme.justia.com/cases/federal/us/236/1/case.html
Gennie Westbrook, formerly a classroom teacher, is a Madison Fellow (2000 TX), and senior advisor for education at The Bill of Rights Institute.
Kenneth M. Casebeer, “Teaching an Old Dog Old Tricks: Coppage v. Kansas and At-Will Employment Revisited” University of Miami School of Law Institutional Repository, 1985 http://repository.law.miami.edu/cgi/viewcontent.cgi?article=1159&context=fac_articles
Coppage v. Kansas https://supreme.justia.com/cases/federal/us/236/1/case.html
Coppage v. Kansas https://www.oyez.org/cases/1900-1940/236us1
Coppage v. Kansas Case Brief http://www.lawschoolcasebriefs.net/2013/11/coppage-v-kansas-case-brief.html
Richard C. Cortner, National Labor Relations Board v. Jones & Laughlin Steel Corp. (1937) The Oxford Companion to the Supreme Court, Kermit Hall (ed) 1992, p. 573.