March 29, 1937 is the date the Supreme Court issued its landmark decision in West Coast Hotel Co. v. Parrish (300 U.S. 379), in which it upheld the constitutional validity of Washington state’s minimum wage statute, and by implication, much more of the New Deal.
The five to four decision reflected an unexpected shift in the voting of Associate Justice Owen Roberts.
President Franklin D. Roosevelt had been frustrated in his efforts to push through several New Deal measures intended to bolster economic recovery during the Great Depression, because they had been struck down by the Supreme Court. He sought to counter the opposition to his program by expanding the number of justices, in order to create a pro-New Deal majority on the bench. Roosevelt proposed the Judiciary Reorganization Bill of 1937, frequently called the “Court-packing plan.” This legislation would have granted the President power to appoint an additional Justice to the U.S. Supreme Court for every sitting member over the age of 70½, up to a maximum of six.
The legislation was presented to Congress on February 5, 1937. The West Coast Hotel ruling came several weeks later, with Associate Justice Owen Roberts joining the more liberal wing of the bench. Justice Roberts had previously ruled against most New Deal legislation. Thus his switch here was widely seen by contemporaries as an effort to maintain the Court’s judicial independence by eliminating Roosevelt’s rationale for judicial reorganization. (This interpretation of Roberts’s action was later called into question.) His move came to be known as “the switch in time that saved nine.”
Ultimately, Roosevelt’s proposed court packing plan failed. The entire episode created a public relations nightmare for Roosevelt and also sapped his influence over Congress.
None of this gainsays the importance of the West Coast Hotel case itself. Here are the facts:
The plaintiff, Elsie Parrish, an employee of the West Coast Hotel Company, received sub-minimum wage compensation for her work. Parrish brought a suit to recover the difference between the wages paid to her and the minimum wage fixed by state law. The question before the Court was: Did the minimum wage law deprive the employer and employee of liberty without due process of law under the Fourteenth Amendment? The specific liberty allegedly infringed was that of freedom of contract.
The Court had previously held in Adkins v. Children’s Hospital that the District of Columbia’s very similar minimum wage act was invalid because it denied freedom of contract under the due process clause of the Fifth Amendment.
(Under the Fifth Amendment, “no person…shall be…deprived of life, liberty, or property, without due process of law….” Under the Fourteenth Amendment, “No State…shall deprive any person of life, liberty, or property, without due process of law….”)
But in West Coast Hotel, the Court held that the State of Washington’s establishment of minimum wages for women was constitutionally legitimate. In effect, they were ruling that Atkins had been decided incorrectly. The Court observed that the Constitution did not mention “freedom of contract” and that “liberty” was subject to the state’s reasonable exercise of its police power (because “liberty safeguarded is liberty in a social organization which requires the protection of law against the evils which menace the health, safety, morals and welfare of the people”). The Court noted that employers and employees were not equally “free” in negotiating contracts, since employees often were constrained by practical and economic realities. This was especially true in the case of women.
The Court wrote: “The State has a special interest in protecting women against employment contracts which through poor working conditions, long hours or scant wages may leave them inadequately supported and undermine their health; because:
(1) The health of women is peculiarly related to the vigor of the race;
(2) Women are especially liable to be overreached and exploited by unscrupulous employers; and
(3) This exploitation and denial of a living wage is not only detrimental to the health and wellbeing of the women affected, but casts a direct burden for their support upon the community.”
Law Professor J.M. Balkin points out that the opinion in West Coast Hotel displayed “radical, humanitarian aspects.” Balkin observes: “…by daring to label the common law regime of property and contract a ‘subsidy for unconscionable employers,’ (379 U.S. at 399), West Coast Hotel affirmed the connection between economic equality and substantive liberty, between economic power and political right.” (83 Nw. U.L. Rev. 275, 310). Balkin suggests that “if the legislature was right to alter the economic status quo because that regime violated human liberty, then the distribution of economic power in society had everything to do with the liberty guaranteed by the due process clause.” (ibid)
This recognition of the nexus between political and economic liberty lasted only one year, however, until the April 25, 1938 decision U.S. v. Carolene Products.