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United States v. Darby Lumber Co.

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Supreme Court of the United States
United States v. Darby Lumber Co
Reference: 312 U.S. 100
Term: 1941
Important Dates
Argued: December 19-20,1940
Decided: February 3, 1941
Outcome
United States District Court for the Southern District of Georgia reversed
Majority
Chief Justice Charles Evans HughesHugo BlackWilliam O. DouglasFelix FrankfurterFrank Murphy • Stanley Forman Reed • Owen RobertsHarlan Fiske Stone

United States v. Darby Lumber Co. is a case decided on February 3, 1941, by the United States Supreme Court holding that the federal government could regulate employment conditions within the states if the employer engages in or has a substantial effect on interstate commerce. The case concerned President Franklin Delano Roosevelt's (D) Fair Labor Standards Act (FLSA) which sought to regulate minimum wages, maximum weekly hours, and child labor at the federal level. The Supreme Court reversed the ruling of the United States District Court for the Southern District of Georgia and held that and held that an employer who manufactures goods within a state is subject to the FLSA if the manufactured goods are shipped out of state.[1][2][3][4]

HIGHLIGHTS
  • The case: United States v. Darby Lumber upheld the legality of the minimum wage under the Constitutional power to regulate interstate commerce.
  • The issue: If a producer ships his goods outside of his state, does the interstate commerce power give the federal government the power to enforce the minimum wage and maximum hour requirements of the federal Fair Labor Standards Act? Can the federal government require business owners to keep records to verify compliance?
  • The outcome: The Supreme Court unanimously reversed the district court's decision and held that the purpose of the Fair Labor Standards Act was to stop states from using substandard labor practices.

  • Why it matters: The Supreme Court's decision in this case held that the federal government could regulate employment conditions within the states if the employer engages in or has a substantial effect on interstate commerce. To find out more about the impact of United States v. Darby Lumber Co., click here to read more.

    Background

    In 1938, Congress passed the Fair Labor Standards Act which established maximum working hours and a minimum wage. Darby Lumber Co., located in Georgia, was charged with violating the conditions of the Fair Labor Standards Act after the company expanded and then began to lose profitability. Some Darby Lumber Co. employees worked more than 44 hours per week without overtime compensation and some employee wages did not meet the minimum wage required by the act.

    Darby Lumber Co. argued that the Fair Labor Standards Act was unconstitutional because Congress did not have the constitutional authority to regulate the manufacture of goods within a state. The United States District Court for the Southern District of Georgia held that the federal government was barred by the Tenth Amendment from setting a minimum wage and maximum hours standard within every state. The United States government appealed the case to the Supreme Court.[4]

    Oral argument

    Oral argument was held on December 19 and 20, 1940. The case was decided on February 3, 1941.[1]

    Decision

    The Supreme Court decided 9-0 to overturn the district court's decision. The court held that congress had the power to regulate employment conditions within the states if the employer engages in interstate commerce. Justice Harlan Fiske Stone delivered the opinion of the court.[1][2]

    Opinion

    Darby's lawyers argued that the manufacture of goods is not commerce and that the Fair Labor Standards Act regulated the manufacture of his lumber products rather than interstate commerce. Justice Stone disagreed, arguing that the manufacture of goods later shipped between states qualifies for regulation as interstate commerce:

    While manufacture is not, of itself, interstate commerce, the shipment of manufactured goods interstate is such commerce, and the prohibition of such shipment by Congress is indubitably a regulation of the commerce. The power to regulate commerce is the power 'to prescribe the rule by which commerce is governed.' Gibbons v. Ogden, 9 Wheat. 1, 22 U. S. 196 . . . . But it is said that the present prohibition falls within the scope of none of these categories; that, while the prohibition is nominally a regulation of the commerce, its motive or purpose is regulation of wages and hours of persons engaged in manufacture, the control of which has been reserved to the states and upon which Georgia and some of the states of destination have placed no restriction; that the effect of the present statute is not to exclude the proscribed articles from interstate commerce in aid of state regulation, as in Kentucky Whip & Collar Co. v. Illinois Central R. Co., supra, but instead, under the guise of a regulation of interstate commerce, it undertakes to regulate wages and hours within the state contrary to the policy of the state which has elected to leave them unregulated.[5]
    Justice Stone, majority opinion in United States v. Darby Lumber Co[2]


    Justice Stone continued, arguing that the authority of Congress to regulate interstate commerce is limited only by the Constitution and does not infringe on state power. He further claimed that the challenged application of the law gave effect to Congress' intent to shape public policy:

    The motive and purpose of the present regulation are plainly to make effective the Congressional conception of public policy that interstate commerce should not be made the instrument of competition in the distribution of goods produced under substandard labor conditions, which competition is injurious to the commerce and to the states from and to which the commerce flows. The motive and purpose of a regulation of interstate commerce are matters for the legislative judgment upon the exercise of which the Constitution places no restriction, and over which the courts are given no control.[5]
    Justice Stone, majority opinion in United States v. Darby Lumber Co[2]


    Justice Stone further found that the court had historically recognized the power of Congress to regulate "activities intrastate which have a substantial effect on the commerce or the exercise of the Congressional power over it."

    Impact

    Federalism
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    Key terms
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    See also: Commerce Clause and Tenth Amendment to the U.S. Constitution

    The proponents of the Fair Labor Standards Act, and President Franklin Roosevelt argued that state regulation of labor practices was ineffective. Roosevelt argued instead that the federal government should unite labor policy in all existing 48 states.[4] During the congressional debates over the Fair Labor Standards Act, opponents expressed concerns that it would affect the viability of new or small businesses.

    The Fair Labor Standards Act was passed in August 1938 and signed into law by President Roosevelt in October 1938. [3] The law established a federal minimum wage, the 44-hour work week standard, and a standard for overtime pay which remains in effect today and requires employers to pay their hourly employees at least 150% of their normal wages for work in excess of the current 40-hour standard.[4]

    The Supreme Court unanimously reversed the lower court's decision which declared the Fair Labor Standards Act a violation of the Tenth Amendment. Justice Hughes' opinion said that Congress could regulate interstate commerce, which "can neither be enlarged nor diminished by the exercise or non-exercise of state power."[2]

    The Supreme Court's decision in United States v. Darby Lumber Co. overturned the precedent set in Hammer v. Dagenhart which made a distinction between manufacturing and interstate commerce. Justice Hughes found the argument of the court weak in that case and said that Congress could regulate both commerce and the manufacture of goods within the state if such goods have a substantial effect on interstate commerce.

    See also

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    Footnotes